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Can new efficiency technology reduce your propane usage? (Our Take on the U.S. EIA’s Annual Energy Outlook 2012 – Part 2)

In 2010, commercial buildings sectors used 8.8 quadrillion Btu of energy, or 12% of total U.S. energy consumption.  Over the next 25 years, the EIA predicts a rise of 9% to 9.5 quadrillion Btu by 2035, which is modest compared to the expectation that commercial floor space will increase by 27% over the same time.  Technology improvements in both the efficiencies of appliances and buildings themselves will play key roles in this slowing of energy use per square foot.

However, faster or slower adoption of efficiency technology, which is tied to both the quality and cost, could change that projection higher or lower.  The EIA looked at three alternatives:

Description Change in energy use from Base (reference) case Details Commercial energy use in 2035 (quadrillion Btu)
2011 Demand Technology Higher future equipment purchases are limited to the options available today 10.1(increase of 6%)
High Demand Technology Lower high-efficiency technologies get deployed quickly 8.6(decrease of 9%)
Best Available Demand Technology Much Lower only the most efficient technology is purchased and installed regardless of cost 7.8(decrease of 18%)
Residential and commercial delivered energy consumption in four cases, 2010-2035 (quadrillion Btu) - from US EIA "AEO2012"

Residential and commercial delivered energy consumption in four cases, 2010-2035 (quadrillion Btu) – from US EIA “AEO2012″

AmeriGas customers, and propane users in general, may be able to move themselves closer to the “High Demand Technology” case than the base case, potentially decreasing energy use by 9%.  We’ll explain more about how to get there after considering the other cases.  In our opinion, unfortunately, the “Best Available Demand Technology” case is simply out of reach due to both cost and technology.  Much of the energy savings is based on improvements in building lighting, specifically LEDs, which the EIA estimates can would reduce cumulative energy use by nearly 8 quadrillion Btu over 25 years.  We feel this is incredibly unlikely given the current economics and state of that technology.  (And we’ll ignore the “2011 Demand Technology” case because there is no doubt that things are improving and reducing energy use which is a good thing for everyone’s bottom line.)

But you can achieve the energy savings that the EIA predicts are possible in the “High Demand Technology” case.  According to the EIA, the primary driver of these savings, nearly 7 quadrillion Btu in cumulative energy savings over 25 years will come from commercial heating and ventilation technology improvements.

Cumulative reductions in commercial energy consumption relative to the 2011 Demand Technology case, 2011-2035 (quadrillion Btu) - from US EIA AEO2012

Cumulative reductions in commercial energy consumption relative to the 2011 Demand Technology case, 2011-2035 (quadrillion Btu) – from US EIA AEO2012

Specifically, the EIA notes that cost and performance improvements in CHPs (Combined Heat and Power systems) which use propane as a fuel, will contribute much to this savings, as well as general efficiency improvements of up to 25% in traditional building heat systems.  CHPs have an added advantage, with the potential to both reduce the amount of propane needed for building heat as well as the amount of purchased electricity.  AmeriGas believes very strongly in CHP technology and has seen it work for clients nationwide.  As PERC and others continue to support CHP technology, it is only going to get better and more affordable and for those reasons you should definitely keep it in mind to reduce your energy usage in the future.

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