EIA: U.S. to Shift Away from Petroleum, Toward Coal by 2030

December 6, 2006

The United States will increasingly seek alternatives to petroleum by 2030, according to the latest long-term energy projections from DOE's Energy Information Administration (EIA). The EIA's "Annual Energy Outlook 2007," released on December 5th, projects ethanol use increasing from 4 billion gallons in 2005 to 14.6 billion gallons (about 8 percent of gasoline consumption by volume) by 2030. Only 300 million gallons of that are projected to come from cellulosic biomass sources; the rest will come from corn. Biodiesel use will also grow rapidly to 400 million gallons in 2030, up from 25 million gallons in 2005. But renewable fuels will also face competition from fossil energy sources, such as coal. Liquids derived from coal are expected to provide 5.7 billion gallons of fuels by 2030, according to the EIA. As a result, petroleum consumption is projected to only increase 20 percent by 2030, while the total energy consumption for transportation increases by nearly 40 percent.

The EIA report also sees a changing auto industry, with sales of hybrids reaching 2 million by 2030, sales of flex-fuel vehicles also reaching 2 million, and sales of diesel vehicles reaching 1.2 million. Combined with other unconventional vehicle technologies, such as fuel cells, these vehicles account for 28 percent of projected light vehicles sales in 2030, up from about 8 percent in 2005. As a result of these and other factors, the projected average fuel economy of light-duty vehicles in 2030 is 29.2 miles per gallon, 4 miles per gallon higher than today.

The EIA is less positive about the growth in renewable power sources, projecting a growth of only 1.5 percent per year through 2030, a rate equal to the growth in electricity use. That yields only a 45 percent growth in renewable power production by 2030. The EIA adjusted its forecast downward from last year's figures "because new, less positive cost and performance characteristics are assumed for several renewable technologies." With natural gas and nuclear power production also losing market share, coal power is expected to take up the slack, with an additional 156 gigawatts of generating capacity. As a result, fossil fuels are projected to still supply 86 percent of U.S. energy needs in 2030, the same as today, and carbon dioxide emissions are expected to grow by 1.2 percent per year, increasing 35 percent by 2030. See the EIA press release and the full report.