Fuel and Feedstock Flexibility Industry Profile
U.S. industry, the largest domestic energy user, is principally dependent on natural gas as a single major source of fuel or feedstock. After decades during which natural gas for industrial use traded at or below $3.50/thousand cubic feet (TCF), the turn of the millennium marked the beginning of unprecedented increases and volatility in natural gas prices. Increased use of the fuel across the economy, coupled with diminishing domestic natural gas supply and production, appear to have driven a fundamental shift in natural gas price behavior. In fact, DOE's Energy Information Agency (EIA) projects that the price of natural gas will more than double over the next 20 years. Industrial users, whose competitiveness relies on inexpensive natural gas, must seek alternatives for their energy requirements.
Alternative fuel use presents a sizeable opportunity for reducing natural gas use, particularly with the escalation in natural gas and petroleum prices since 2004. Industrial Technologies Program (ITP) is initiating a fuel flexibility program to accelerate the market adoption of emerging technology options for industry, such as the utilization of gasified fuels, landfill gas, and electro-technologies. The potential for fuel switching from natural gas, in boilers alone, is equivalent to 200 trillion British thermal units per year (Btu/yr) in the near-term. Through boiler modifications, an additional 750 trillion Btu/yr could also be realized in the mid-term.