US Energy Information Administration Projects Significant Reduction in CO2 Emissions by 2030
The US Energy Information Administration (EIA) has released its Annual Energy Outlook 2023 (AEO2023), projecting a reduction in US energy-related CO2 emissions of 25-38% below 2005 levels by 2030. The report cited increased electrification, higher equipment efficiency, and the deployment of renewables in the electric sector as the main drivers of emissions reductions. However, the report also noted that emissions reductions are limited by longer-term growth in US transportation and industrial activity. Despite increased renewable energy generation, natural gas remains the largest source of US electricity generation, growing from a 37% share in 2021 to 39% in 2022.
The report also highlights the possibility of a “high oil and gas supply” scenario where US production could increase to around 30 million barrels per day in 2050, but in all cases, the US is projected to remain a net exporter of petroleum products and natural gas through 2050.
Renewable generating capacity is projected to grow in all regions of the US, supported by growth in installed battery capacity. The EIA projects stable growth in US electric power demand through 2050 due to increasing electrification and ongoing economic growth. EIA’s projections indicate that the share of zero-carbon electricity generation will increase due to the investment in wind and solar energy sources and their cost advantage in operation.
The report also highlights technological advancements and electrification as drivers of projected decreases in demand-side energy intensity. According to the EIA, there will be an increase in the usage of electric arc furnaces in the iron and steel sector, as well as heat pumps and electric vehicles. The continuous decrease in energy intensity is being prolonged by the implementation of stricter building codes and the use of more efficient equipment in both residential and commercial areas. Corporate Average Fuel Economy (CAFE) standards and the increasing adoption of electric vehicles (EVs) are contributing to the improvement of fuel efficiency in the transportation industry, particularly in light-duty vehicles.
For the first time ever, renewable power generation – that’s wind, solar, hydro, biomass, and geothermal – exceeded coal-fired generation in the US electric power sector in 2022, according to the EIA. Combined renewables provided 21% of the 4.09 GWh of electric power produced last year across the US, compared to 19% in 2021, while coal-fired generation’s share slipped from 23% in 2021 to 20% in 2022 as a number of coal-fired power plants retired and the remaining plants were used less.
The EIA’s projections are derived from its publication Annual Energy Outlook 2023, which includes downloadable data files, Excel sheets, interactable dashboards, and narrative reports on the Administration’s summary of today’s energy profile and the outlooks for 2030 and 2050.
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