U.S. to Remain Net Exporter Through 2050 Through Technology-enabled Growth
The AEO2020 Reference case, which serves as a baseline for exploring the effects of different assumptions about the economy, policy, and technology, projects renewables to be the fastest-growing source of electricity generation through 2050, driven by continued declines in the capital costs for solar and wind technologies. Slow growth in U.S. energy consumption, as a result of continued increases in energy efficiency, and technologically enabled growth in domestic oil and natural gas production lead the United States to remain a net energy exporter through 2050.
The AEO2020 Reference case projects domestic energy demand to grow 0.3% per year on average through 2050, slower than the average annual growth of 1.9% in U.S. gross domestic product. This projection is largely driven by continued increases in energy efficiency in the end-use sectors. Gains in appliance efficiency in the residential and commercial sectors, increases in efficiency of new capital equipment in the industrial sector, and increases in fuel economy partially offset the growth inthe number of households, industrial activity, and vehicle-miles traveled.
The AEO2020 Reference case also projects the share of U.S. electricity generation from renewable sources to double from 19% of total generation in 2019 to 38% by 2050. Solar contributes the most to the growth, more than tripling from 14% of total renewable generation in 2019 to 46% by 2050. Although coal and nuclear generation decline through the mid-2020s as a result of capacity retirements, their generation stabilizes over the longer term as the more economically viable plants remain in service.
At the same time, the United States continues to produce historically high levels of crude oil and natural gas. In the AEO2020 Reference case, U.S. crude oil production continues to set annual records through the mid-2020s and remains near 14.0 million barrels per day (b/d) through the mid-2040s. EIA projects U.S. dry natural gas production will reach 45 trillion cubic feet by 2050. The continued development of tight oil and shale gas resources supports growth in these fuels.
With the production growth outpacing growth in domestic consumption of crude oil, petroleum products, and natural gas, U.S. net exports of these fuels increase. In the Reference case, the United States will continue to export more petroleum and other liquids than it imports, with a peak at more than 3.8 million barrels per day (b/d) in the early 2030s before gradually declining to 0.2 million b/d in 2050 as domestic consumption slowly rises. U.S. liquefied natural gas (LNG) exports and natural gas pipeline exports to Canada and to Mexico continue to rise through the 2020s before flattening for the remainder of the projection period.
After falling in the first half of the projection period, U.S. energy-related carbon dioxide (CO2) emissions resume modest growth in the 2030s, but they remain lower than 2019 levels through 2050. Until about 2030, U.S. energy-related CO2 emissions decrease as a result of retirements of coal-fired generation capacity and corresponding changes in the mix of fuels consumed by the electric power sector. After 2030, increases in energy demand in the other sectors—predominantly transportation and industrial—result in increases in emissions.
EIA’s AEO2020 also includes eight side cases that show the effects of changing key model assumptions, including two new cases (High Renewables Cost and Low Renewables Cost) that explore the uncertainty of future costs of renewable power generation technologies on U.S. electricity markets. The Issues in Focus article to be released later today with the AEO2020 discusses the results of these new cases.
Source: www.worldoil.com
