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Our Take on U.S. EIA’s Annual Energy Outlook 2012 – Part 1

The U.S. Energy Information Administration’s Annual Energy Outlook 2012 (AEO12) was released earlier this week on June 25th. The report is over 250 pages long and covers not only the current status of the energy prices and use in the U.S. but also provides projections through 2035 to help understand what changes are approaching. Over the next few weeks in a series of articles, we’ll break the report down and provide our insight. This week in part 1, we’ll look at some of the major trends in energy that were identified in the report.

 

The rate of growth in energy use will slow, reflecting moderate population growth, an extended economic recovery, and increasing energy efficiency in end-use applications.

Energy consumption per capita is forecasted to decline by an average of 0.6% per year from 2010 to 2035. For propane users, increases in efficiency of heating equipment, appliances, and forklifts mean you will need less energy to accomplish the same task.

Domestic crude oil production increases

AEO2012 projections for total U.S. crude oil production in 2035 range as high as 7.8 million barrels per day, compared to 5.5 million in 2010. More domestic crude means that propane will become even more of a domestic fuel, reducing potential shocks from foreign supply.

 

Natural gas production increases through 2035, allowing the United States to transition from a net importer to a net exporter of natural gas

Shale gas production increases from 5.0 to 13.6 trillion cubic feet per year between 2010 and 2035 indicate that there will be additional supplies of propane. However with an increase this large, much of the propane recovered from “wet” shale gas is expected to be exported along with liquefied natural gas.

 

Total energy-related emissions of carbon dioxide in the United States remain below their 2005 level through 2035

Propane, much like natural gas, is less carbon-intensive than other fossil fuels. Increased use of both propane and natural gas in combination with modest economic growth, growing use of renewable technologies and fuels, and efficiency improvements will help keep energy-related carbon dioxide (CO2) emissions down.

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