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A new report from the Energy Security Leadership Council, a group including business leaders and retired military officials, warns that U.S. energy policy advocates are conflating “energy independence” with “energy security.” Relying on increased domestic production oil and natural gas is misguided, they argue, and the country should instead seek to decrease reliance on all oil. The report acknowledges that the recent boom in energy production in the U.S. will have positive economic impacts, and calls for the government to make federal lands available for oil and gas development. However, the authors state, “as long as the United States remains… [more]
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Domestic natural gas production continues to expand, while natural gas spot prices are at historic lows. Many utilities are responding to these changing market dynamics by building gas plants or “fuel-switching” existing power plants from more expensive fuels to gas. As a result, coal generation continues to fall. Due in part to price competition with natural gas, some Congressional “clean energy” subsidies may not be renewed. EIA projections suggest that domestic production will continue to increase, and that natural gas prices faced by electric utilities will remain below $7.00/mBtu, through 2035. [Source: EIA] What does near- to mid-term domestic natural… [more]
View InsightEastern Utah may see tar sand production begin later this year. A private company, the Alberta-based U.S. Oil Sands, has invested $6 million since 2005 to test the oil sands at its 6,000-acre lease in eastern Utah and develop pilot projects on state land. They were granted preliminary permits to begin production in 2009, and have been raising capital and developing plans to begin production. “We would expect to hopefully to have this up and running by about September of next year,” said Cameron Todd, CEO of U.S. Oil Sands. The Bureau of Land Management estimates that the sands could… [more]
View InsightThis month OPEC, the intergovernmental affiliation of twelve oil-producing countries, released two different estimates for its members’ monthly crude production. The first estimated 31.2m b/d in February, and relied on secondary sources, as OPEC estimates have traditionally done since 1986. The significantly higher second estimate of 32.1m b/d relied on direct internal reporting from OPEC member countries. The estimates’ disparity casts doubt on the accuracy of OPEC’s reporting. OPEC accounts for 44% of world oil supply. In an article for Platts, Richard Swann explains “OPEC crude production estimates are undoubtedly among the world’s most important pieces of oil market data.… [more]
View InsightA recent Congressional Research Service report titled “Rising Gasoline Prices 2012” states that Congress has “limited short term options … to address gasoline prices.” The report identifies six short-run policy options – a Strategic Petroleum Reserve release, a gasoline tax holiday, relaxed fuel specifications, limits on refined gasoline exports, limits on commodities speculation, and diplomatic measures – and concludes that it is unclear “what the price impact of these short term options would be” and that they would involve policy tradeoffs which may include “national security, fiscal, and health priorities.” The report briefly addresses longer-term policy options, i.e. “measures that… [more]
View InsightSenate Energy & Natural Resources Chairman Jeff Bingaman (D-NM) has introduced the Clean Energy Standard Act of 2012, which would require electric utilities to derive increasing percentages of their supply mix from low-CO2 sources. The bill would take effect in 2015, and would require that by 2035 84% of power from large utilities come from low-CO2 sources. Sources eligible under the legislation include: renewables, such as wind and solar, “qualified” renewable biomass and waste-to-energy, hydropower, natural gas, and nuclear. Facilities with CO2 capture and storage, and some combined heat and power facilities, are also eligible. The bill establishes a market-based… [more]
View InsightU.S. and Mexican negotiators on February 20th reached a deal – called The Transboundary Agreement – that would regulate oil and gas development along the countries’ maritime border in the Gulf of Mexico. The Agreement would allow each country to oversee the environmental and safety protocols of the other, and could by June open 1.5 million acres of U.S. offshore territory for oil and gas development. The U.S. Interior Department estimates that the area in question “contains as much as 172 million barrels of oil and 300 billion cubic feet of natural gas, relatively modest amounts by the oil-rich gulf’s… [more]
View InsightPresident Obama sent his requested FY2013 budget to Congress Monday, and requested, among other energy-related items, significant increases to energy R&D, renewable energy investments, and energy efficiency programs. From the request: “In light of the tight discretionary spending caps, this increase in funding is significant and a testament to the importance of innovation and clean energy to the country’s economic future.” Among the energy-related budget requests: $27.2 billion to the Department of Energy, a 3.2% hike over FY2012 $5 billion for DOE’s Office of Science $2.3 billion for DOE’s Energy Efficiency and Renewable Energy office – a 29% increase –… [more]
View InsightAccording to data collected and reported by Bloomberg News, the “U.S. is the closest it has been in almost 20 years to achieving energy self-sufficiency”. In the first 10 months of 2011, 81% of U.S. energy demand was met by domestic sources, up from a record low of 70% in 2005. If the 2011 numbers are accurate, this would be the highest proportion of U.S. energy demand met by domestic sources since 1992. This upward trend in energy self-sufficiency is due in large part to increased oil and natural gas development, and low natural gas prices. “Domestic oil output is… [more]
View InsightThe Energy Information Administration (EIA) has lowered its estimates of U.S. natural gas resources. The EIA’s 2012 estimate for total U.S. natural gas is 482 trillion cubic feet, down more than 40% from its 2011 estimate of 827 tcf. [New York Times] Because of increased gas production throughout the U.S., EIA had more data available in making its 2012 estimates. For example, with additional data from increased production throughout the Marcellus shale – a geological formation stretching beneath West Virginia, Pennsylvania, Ohio and New York – EIA adjusted its estimates for the Marcellus to 141 tcf, down nearly 66% from… [more]
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