| May 11, 2010 |  |
Energy Department's Annual Outlook Underscores Need for Strong Renewable Energy Policies, Touts Benefits of Fuel Economy Standards
The Department of Energy's Energy Information Administration (EIA) today released its "Annual Energy Outlook 2010," which provides an overview of the nation's current energy use and projects future energy trends. Experts at the Union of Concerned Scientists (UCS) took a close look at the EIA's take on renewable energy and fuel economy.
According to Steve Clemmer, research director for the Climate and Energy Program at the Union of Concerned Scientists (UCS), "A key takeaway in the 'Energy Outlook' is that the renewable energy industry is expanding steadily in all parts of the country. But these modest gains are a tiny fraction of U.S. renewable energy and job creation potential. On the eve of the release of the Kerry-Lieberman climate bill, it's key to note that—if done right—comprehensive federal legislation that puts a price on pollution, spurs renewable energy development, and drives a cleaner transportation system could unleash that potential.."
On the fuel-economy front, Clemmer's colleague in UCS's Clean Vehicle Program, senior federal policy analyst Brendan Bell said, "Fuel-economy standards are like an insurance policy against high gas prices for consumers. The new automobile standards show that we can save consumers billions of dollars at the pump—now we need to do the same for big rig trucks."
Energy and transportation experts at the Union of Concerned Scientists have reviewed the report and discuss some of the highlights below.
ELECTRICITY SECTOR HIGHLIGHTS
Renewable energy growth eclipses bills in Congress: The EIA projects that the percentage of U.S. electricity produced by non-hydro renewable energy sources will increase from 4 percent in 2009 to 12.3 percent in 2030, compared to last's year projection of 11 percent in 2030. This projected growth in renewable energy is due primarily to state renewable electricity standards and federal tax credits included in last year's stimulus bill that are set to expire as early as next year for some renewable energy technologies. UCS estimates that this "business as usual" renewable development will eclipse the amount of clean energy developed in renewable electricity standards currently proposed in Congress. Any serious national effort to increase renewable energy capacity and create jobs means targets must be strengthened considerably.
All parts of the nation will see renewable energy growth: The "Energy Outlook" projects that renewable energy technologies (excluding hydropower) will represent 41 percent of the new electric capacity built between 2008 and 2035. EIA projects that new renewable energy facilities will provide three times the capacity created by new coal plants and nearly 11 times the capacity developed with new nuclear plants. EIA projects that renewable energy will increase in all regions of the country, including the Southeast. That region's renewable energy capacity is expected to increase from 4,500 megawatts (MW) in 2009 to 17,300 MW by 2030. This growth is impressive compared with today's levels, but it still falls well short of the region's true homegrown, clean energy potential.
Recent studies show economic benefits from increasing renewable electricity: A number of recent studies—including those by the Department of Energy—show that a strong national renewable electricity standard is feasible and affordable. A 2009 UCS analysis found that the nation could meet a 25 percent by 2025 renewable electricity standard, generate 300,000 new jobs, and save consumers $64.3 billion on their electric and natural gas bills.
TRANSPORTATION SECTOR HIGHLIGHTS
Fuel-economy standards protect consumers from increasing fuel prices: The "EIA Outlook" anticipates a 35-percent increase in gasoline prices over the next decade, from $2.49 in 2010 to $3.34 in 2020 (in 2008 dollars). Using the EIA's fuel price projections, UCS estimates drivers will save $46 billion in 2020—even after factoring in the cost of vehicle technology improvements.
No fuel economy standards for big rigs means truckers will pay at the pump: New federal fuel-economy standards do not apply to big rigs and other heavy trucks, so the increases in fuel costs for these vehicles will not be offset. A UCS analysis found that the average medium- and heavy-duty truck could become at least 60 percent more fuel efficient by 2030 by instituting a range of efficiency improvements, including low-rolling resistance tires, advanced engines, and more aerodynamic tractor and trailer designs. Using the EIA's fuel price data, that level of fuel efficiency would save truckers $34 billion in 2030.
Clean biofuels will struggle to meet mandates: The "Energy Outlook" starkly illustrates the failure of the cellulosic biofuels industry to date. This year, the EIA projects cellulosic ethanol volumes will be 97 percent lower than the 100 million gallon mandate in the Renewable Fuels Standard (RFS). Long-term commercialization of cellulosic biofuels lags behind RFS targets by a decade.
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