The United States could become a net exporter of energy by 2022, according to the Department of Energy’s Energy Information Administration. EIA’s 2018 Annual Energy Outlook, the agency’s premier analytical product, says that “continued development of U.S. shale and tight oil and natural gas resources paired with modest consumption growth” will lead to the U.S. exporting more crude oil, oil products, and LNG than imports of crude.
Linda Capuano, EIA’s new administrator, unveiled the outlook at a conference in Washington this morning. She noted that the U.S. “has been a net energy importer since 1953.”
The outlook consists of a reference case, which the statistical agency believes is most likely, and six other cases: Low and high economic growth; low and high oil prices; low and high oil and gas resource and technology, taking all of them out to 2050. The transition to an energy exporter could happen sooner under assumptions of larger growth in oil and gas production or higher world oil prices.
Capuano stressed that the reference case and supporting cases “project what may happen, not what will happen. The cases assume current laws and regulations remain in place throughout the period to 2050. Reflecting the current turmoil over the Obama administration’s Clean Power Plan, which remains on the books but the Trump administration wants to kill,
EIA did separate analyses based on the plan vanishing or continuing in force. The plan has yet to be implemented in any significant fashion at the Environmental Protection Agency and is tied up in federal court.
Among the key findings in the 2018 outlook:
* U.S. energy consumption grows only about 0.4% annually to 2050 in the reference case, less than expected population growth of 0.6% annually. EIA expects annual gross domestic product growth of 2% through 2050.
* After 2022, natural gas and non-hydro renewables will produce almost all new electric generation. EIA says natural gas prices are likely to remain under $5/mmBtu, while costs of adding new renewables “are expected to continue declining, especially for solar photovoltaic systems.”
* Growth in production of liquids (crude and refined products) and natural gas “continues to grow for decades, sliding downward “toward the end of the projection period as less productive areas are developed.”
Renewable energy advocates began attacking the EIA analysis even before it was released. Writing for the Post Carbon Institute, J. David Hughes, who worked for the Geological Survey of Canada for over 30 years, wrote a paper critiquing the 2017 EIA Annual Energy Outlook in advance on today’s 2018 version. “There is no doubt that the U.S. can produce substantial amounts of shale gas and tight oil over the short- and medium-term,” Hughes noted. “Unrealistic long-term forecasts, however, are a disservice to planning a viable long-term energy strategy. The very high to extremely optimistic EIA projections impart an unjustified level of comfort for long-term energy sustainability.”
Capuano, EIA’s new chief, took office in January 2017. She has impressive credentials. They include multiple advanced degrees culminating in a Ph.D. in engineering from Stanford University, and a variety of private sector jobs including at Marathon Oil, Honeywell, and IBM. She has served on the board of the California Independent System Operator.
Capuano became a fellow at Rice University’s Baker Institute for Public Policy in 2014, where she researched how to improve treatment of the brackish wastewater from oil and gas drilling until picked by the Trump administration to replace Adam Sieminski at EIA.
The Baker Institute, established in 1993, has deep Republican ties. The director is Edward Djerejian, who was in the Reagan White House early in his career and served in a number of diplomatic roles, including U.S. ambassador to Syria in the George H.W. Bush administration and U.S. ambassador the Israel in the Clinton administration. The Baker Institute is named for its founder, James Baker III, former Republican secretary of state, secretary of the Treasury and White House chief of staff for Reagan and the first Bush.
— Kennedy Maize