Last month, the Energy Information Agency (EIA), an independent federal agency that collects, analyzes and disseminates impartial energy data, released its Annual Energy Outlook report for 2014, which includes energy pricing and consumption projections to 2040.
Fortunately, EIA’s report spells good news for the U.S. economy and, in turn, energy consumers. Among the report’s key findings are that ongoing advancements in technologies for crude oil and natural gas production will continue to render increases in domestic supply — reshaping the U.S. energy economy and reducing the nation’s “net dependence on imported oil.”
Here’s a breakdown of the EIA’s key findings and their implications on the economy and energy consumers:
Domestic production of oil and natural gas will continue to grow. This is a welcome prediction for the U.S. energy economy, as more domestic resources have become available for consumers to use here at home.
Increased production makes it possible for the U.S. to decrease its net dependence on foreign sources of energy, keep investment dollars at home, and support domestic job growth in the oil and gas industries. For energy consumers, this increased domestic production translates directly into greater supplies of affordable and stable energy – whether it is cheaper prices at the pump, more affordable prices for home heating in the winter or reduced electricity prices in consumers’ monthly utility bills.
According to the EIA report, U.S. crude oil production is expected to “increase sharply” and will approach a record by 2016 — reaching its highest level in 46 years as rising output from shale formations boosts domestic supplies, thereby diminishing the nation’s need to import foreign oil.
Low natural gas prices boost natural gas-intensive industries. This is a positive sign for the manufacturing sector of the economy, which continues to pull its weight in speeding the nation’s economic recovery and already supports approximately 17 million jobs in the U.S.Domestic output will grow annually by about 800,000 barrels a day and will reach 9.5 million barrels in 2016, nearly matching the record level produced in 1970, according to the report. In addition, natural gas production is projected to grow steadily, with a 56% increase between 2012 and 2040, when production reaches 37.6 trillion cubic feet (Tcf).
In fact, EIA predicts that industrial natural gas consumption is projected to grow by 22 percent between 2012 and 2025. According to the Agency, bulk chemicals and metals-based durables account for much of the increased growth in industrial shipments. Industrial shipments of bulk chemicals, which benefit from an increased supply of natural gas liquids, are projected to grow by 3.4% per year from 2012 to 2025.
As the voice of the energy consumer, Consumer Energy Alliance (CEA) is encouraged by the EIA’s Annual Energy Outlook, and we look forward reviewing to the full report in spring 2014. We will continue to post on various energy trends and news, so be sure to visit The Energy Voice often for updates and additional information.
In the meantime, please feel free to visit our consumers page for tips on staying warm and saving energy costs this winter.
