Analysis & Projections

Annual Energy Outlook Related

Assumptions to the Annual Energy Outlook

Released: June 11, 2014

This report presents the major assumptions of the National Energy Modeling System (NEMS) used to generate the projections in the Annual Energy Outlook, including general features of the model structure, assumptions concerning energy markets, and the key input data and parameters that are the most significant in formulating the model results. (archived versions)

 
Annual Energy Outlook

Released: May 7, 2014

The projections in the U.S. Energy Information Administration's (EIA's) Annual Energy Outlook 2014 (AEO2014) focus on the factors that shape the U.S. energy system over the long term. Under the assumption that current laws and regulations remain unchanged throughout the projections, the AEO2014 Reference case provides the basis for examination and discussion of energy production, consumption, technology, and market trends and the direction they may take in the future. It also serves as a starting point for analysis of potential changes in energy policies. (archived versions)

Annual Energy Outlook Retrospective Review

Released: April 7, 2014

The Annual Energy Outlook Retrospective Review provides a yearly comparison between realized energy outcomes and the Reference case projections included in previous Annual Energy Outlooks (AEO) beginning with 1982. This edition of the report adds the AEO 2012 projections and updates the historical data to incorporate the latest data revisions. (archived versions)

 
How to obtain the National Energy Modeling System (NEMS)

Released: November 6, 2013

The National Energy Modeling System (NEMS) NEMS is used by the modelers at the U. S. Energy Information Administration (EIA) who understand its structure and programming. NEMS has only been used by a few organizations outside of the EIA, because most people that requested NEMS found out that it was too difficult or rigid to use. NEMS is not typically used for state-level analysis and is poorly suited for application to other countries. However, many do obtain the model simply to use the data in its input files or to examine the source code.

Modeling Distributed Generation in the Buildings Sectors

Released: August 29, 2013

This report focuses on how the Energy Information Administrationmodels residential and commercial sector distributed generation, including combined heat and power, for the Annual Energy Outlook.

 
Distributed Generation System Characteristics and Costs in the Buildings Sector

Released: August 7, 2013

The Energy Information Administration (EIA) works with technology experts to project the cost and performance of future residential and commercial sector photovoltaic (PV) and small wind installations rather than developing technology projections in-house. These reports have always been available by request. By providing the reports online, EIA is increasing transparency for the assumptions used for our Annual Energy Outlook buildings sector distributed generation projections.

 
Updated Buildings Sector Appliance and Equipment Costs and Efficiency

Released: August 7, 2013

The Energy Information Administration (EIA) works with technology experts to project the cost and efficiency of future heating, ventilation, and air-conditioning (HVAC), lighting, and other major end-use equipment rather than developing residential and commercial technology projections in-house. These reports have always been available by request. By providing the reports online, EIA is increasing transparency for some of the most important assumptions used for our Annual Energy Outlook projections of buildings energy demand.

 
Further Sensitivity Analysis of Hypothetical Policies to Limit Energy-Related Carbon Dioxide Emissions

Released: July 18, 2013

This analysis supplements the Annual Energy Outlook 2013 alternative cases which imposed hypothetical carbon dioxide emission fees on fossil fuel consumers. It offers further cases that examine the impacts of fees placed only on the emissions from electric power facilities, impacts of returning potential revenues to consumers, and two cap-and-trade policies.

 
State Energy Efficiency Program Evaluation Inventory

Released: July 11, 2013

The focus of this inventory, some of which has been placed into a searchable spreadsheet, is to support the National Energy Modeling System (NEMS) and to research cost information in state-mandated energy efficiency program evaluations – e.g., for use in updating analytic and modeling assumptions used by the U.S. Energy Information Administration (EIA).

 
Supplemental Tables to the Annual Energy Outlook

Released: May 1, 2013

The Annual Energy Outlook (AEO) Supplemental tables were generated for the reference case of the AEO using the National Energy Modeling System, a computer-based model which produces annual projections of energy markets. Most of the tables were not published in the AEO, but contain regional and other more detailed projections underlying the AEO projections. (archived versions)

Updated Capital Cost Estimates for Utility Scale Electricity Generating Plants

Released: April 12, 2013

The current and future projected cost and performance characteristics of new electric generating capacity are a critical input into the development of energy projections and analyses.

 
Analysis of Selected Provisions of the Domestic Manufacturing and Energy Jobs Act of 2010

Released: October 18, 2010

This report responds to a letter dated August 16, 2010, from Janice Mays, Staff Director of the U.S. House of Representatives' Committee on Ways and Means, requesting that the U.S. Energy Information Administration (EIA) analyze several provisions included in the July 26, 2010, discussion draft of the Domestic Manufacturing and Energy Jobs Act of 2010.

 
Liquid Fuels Taxes and Credits (released in AEO2010)

Released: May 11, 2010

Provides a review of the treatment of federal fuels taxes and tax credits in Annual Energy Outlook 2010.

Natural Gas as a Fuel for Heavy Trucks: Issues and Incentives (released in AEO2010)

Released: May 11, 2010

Environmental and energy security concerns related to petroleum use for transportation fuels, together with recent growth in U.S. proved reserves and technically recoverable natural gas resources, including shale gas, have sparked interest in policy proposals aimed at stimulating increased use of natural gas as a vehicle fuel, particularly for heavy trucks.

No Sunset and Extended Policies Cases (released in AEO2010)

Released: May 11, 2010

The Annual Energy Outlook 2010 Reference case is best described as a current laws and regulations case, because it generally assumes that existing laws and fully promulgated regulations will remain unchanged throughout the projection period, unless the legislation establishing them specifically calls for them to end or change. The Reference case often serves as a starting point for the analysis of proposed legislative or regulatory changes, a task that would be difficult if the Reference case included projected legislative or regulatory changes.

American Recovery and Reinvestment Act of 2009: Summary of Provisions (released in AEO2010)

Released: May 11, 2010

The American Recovery and Reinvestment Act of 2009 (ARRA), signed into law in mid-February 2009, provides significant new federal funding, loan guarantees, and tax credits to stimulate investments in energy efficiency and renewable energy. The provisions of ARRA were incorporated initially as part of a revision to the Annual Energy Outlook 2009 Reference case that was released in April 2009, and they also are included in Annual Energy Outlook 2010.

Energy Demand (released in AEO2010)

Released: May 11, 2010

Growth in U.S. energy use is linked to population growth through increases in demand for housing, commercial floorspace, transportation, manufacturing, and services. This affects not only the level of energy use, but also the mix of fuels and consumption by sector.

Comparing Efficiency Projections (released in AEO2010)

Released: May 11, 2010

Realized improvements in energy efficiency generally rely on a combination of technology and economics. The figure below illustrates the role of technology assumptions in the Annual Energy Outlook 2010 projections for energy efficiency in the residential and commercial buildings sector. Projected energy consumption in the Reference case is compared with projections in the Best Available Technology, High Technology, and 2009 Technology cases and an estimate based on an assumption of no change in efficiency for building shells and equipment.

Updated State Air Emissions Regulations (released in AEO2010)

Released: May 11, 2010

The Regional Greenhouse Gas Initiative (RGGI) is a program that includes 10 Northeast states that have agreed to curtail and reverse growth in their carbon dioxide (CO2) emissions. The RGGI program includes all electricity generating units with a capacity of at least 25 megawatts and requires an allowance for each ton of CO2 emitted. The first year of mandatory compliance was in 2009.

State Renewable Energy Requirements and Goals: Update through 2008 (Update) (released in AEO2009)

Released: May 11, 2010

State renewable portfolio standards (RPS) programs continue to play an important role in Annual Energy Outlook 2009, growing in number while existing programs are modified with more stringent targets. In total, 28 states and the District of Columbia now have mandatory RPS programs, and at least 4 other states have voluntary renewable energy programs. In the absence of a federal renewable electricity standard, each state determines its own levels of generation, eligible technologies, and noncompliance penalties. The growth in state renewable energy requirements has led to an expansion of renewable energy credit (REC) markets, which vary from state to state. Credit prices depend on the state renewable requirements and how easily they can be met.

Factors Affecting the Relationship between Crude Oil and Natural Gas Prices (released in AEO2010)

Released: May 11, 2010

Over the 1995-2005 period, crude oil prices and U.S. natural gas prices tended to move together, which supported the conclusion that the markets for the two commodities were connected. Figure 26 illustrates the fairly stable ratio over that period between the price of low-sulfur light crude oil at Cushing, Oklahoma, and the price of natural gas at the Henry Hub on an energy-equivalent basis.

New EPA Guidelines for Review of Surface Coal Mining Operations in Appalachia (released in AEO2010)

Released: May 11, 2010

On April 1, 2010, the Environmental Protection Agency (EPA) issued a set of new guidelines to several of its Regional offices regarding the compliance of surface coal mining operations in Appalachia with the provisions of the Clean Water Act (CWA), the National Environmental Policy Act, and the environmental justice Executive Order (E.O. 12898). The stated purpose of the guidance was to explain more fully the approach that the EPA will be following in permit reviews, and to provide additional assurance that its Regional offices use clear, consistent, and science-based standards in reviewing the permits. Although the new guidelines go into effect immediately, they will be subjected to review both by the public and by the EPA's Science Advisory Board, with a set of final guidelines to be issued no later than April 1, 2011.

U.S. Nuclear Power Plants: Continued Life or Replacement After 60? (released in AEO2010)

Released: May 11, 2010

Nuclear power plants generate approximately 20% of U.S. electricity, and the plants in operation today are often seen as attractive assets in the current environment of uncertainty about future fossil fuel prices, high construction costs for new power plants (particularly nuclear plants), and the potential enactment of greenhouse gas regulations. Existing nuclear power plants have low fuel costs and relatively high power output. However, there is uncertainty about how long they will be allowed to continue operating.

Energy Intensity Trends in AEO2010 (released in AEO2010)

Released: May 11, 2010

Energy intensity (energy consumption per dollar of real GDP) indicates how much energy a country uses to produce its goods and services. From the early 1950s to the early 1970s, U.S. total primary energy consumption and real GDP increased at nearly the same annual rate. During that period, real oil prices remained virtually flat. In contrast, from the mid-1970s to 2008, the relationship between energy consumption and real GDP growth changed, with primary energy consumption growing at less than one-third the previous average rate and real GDP growth continuing to grow at its historical rate. The decoupling of real GDP growth from energy consumption growth led to a decline in energy intensity that averaged 2.8% per year from 1973 to 2008. In the Annual Energy Outlook 2010 Reference case, energy intensity continues to decline, at an average annual rate of 1.9% from 2008 to 2035.

Clean Air Interstate Rule: Changes and Modeling in AEO2010 (released in AEO2010)

Released: May 11, 2010

On December 23, 2008, the D.C. Circuit Court remanded but did not vacate the Clean Air Interstate Rule (CAIR), overriding its previous decision on February 8, 2008, to remand and vacate CAIR. The December decision, which is reflected in Annual Energy Outlook 2010 (AEO) , allows CAIR to remain in effect, providing time for the Environmental Protection Agency to modify the rule in order to address objections raised by the Court in its earlier decision. A similar rule, referred to as the Clean Air Mercury Rule (CAMR), which was to set up a cap-and-trade system for reducing mercury emissions by approximately 70%, is not represented in the AEO2010 projections, because it was vacated by the D.C. Circuit Court in February 2008.

Accounting for Carbon Dioxide Emissions from Biomass Energy Combustion (released in AEO2010)

Released: May 11, 2010

Carbon Dioxide (CO2) emissions from the combustion of biomass to produce energy are excluded from the energy-related CO2 emissions reported in Annual Energy Outlook 2010. According to current international convention, carbon released through biomass combustion is excluded from reported energy-related emissions. The release of carbon from biomass combustion is assumed to be balanced by the uptake of carbon when the feedstock is grown, resulting in zero net emissions over some period of time]. However, analysts have debated whether increased use of biomass energy may result in a decline in terrestrial carbon stocks, leading to a net positive release of carbon rather than the zero net release assumed by its exclusion from reported energy-related emissions.

World Oil Prices and Production Trends in AEO2010 (released in AEO2010)

Released: May 11, 2010

In Annual Energy Outlook 2010, the price of light, low-sulfur (or "sweet") crude oil delivered at Cushing, Oklahoma, is tracked to represent movements in world oil prices. The Energy Information Administration makes projections of future supply and demand for "total liquids,"" which includes conventional petroleum liquids -- such as conventional crude oil, natural gas plant liquids, and refinery gain -- in addition to unconventional liquids, which include biofuels, bitumen, coal-to-liquids (CTL), gas-to-liquids (GTL), extra-heavy oils, and shale oil.

State Renewable Energy Requirements and Goals: Update through 2009 (Update) (released in AEO2010)

Released: May 11, 2010

To the extent possible,Annual Energy Outlook 2010 (AEO) incorporates the impacts of state laws requiring the addition of renewable generation or capacity by utilities doing business in the states. Currently, 30 states and the District of Columbia have enforceable renewable portfolio standards (RPS) or similar laws). Under such standards, each state determines its own levels of generation, eligible technologies, and noncompliance penalties. AEO2010 includes the impacts of all laws in effect as of September 2009 (with the exception of Hawaii, because the National Energy Modeling System provides electricity market projections for the continental United States only).

CAFE Standards (released in AEO2010)

Released: May 11, 2010

Pursuant to the Presidents announcement of a National Fuel Efficiency Policy, the National Highway Traffic Safety Administration (NHTSA) and the EPA have promulgated nationally coordinated standards for tailpipe Carbon Dioxide (CO2)-equivalent emissions and fuel economy for light-duty vehicles (LDVs), which includes both passenger cars and light-duty trucks. In the joint rulemaking, the Environmental Protection Agency is enacting CO2-equivalent emissions standards under the Clean Air Act (CAA), and NHTSA is enacting companion Corporate Average Fuel Economy standards under the Energy Policy and Conservation Act, as amended by the Energy Independence and Security Act of 2007.

Importance of Low Permeability Natural Gas Reservoirs (released in AEO2010)

Released: May 11, 2010

Production from low-permeability reservoirs, including shale gas and tight gas, has become a major source of domestic natural gas supply. In 2008, low-permeability reservoirs accounted for about 40% of natural gas production and about 35% of natural gas consumption in the United States. Permeability is a measure of the rate at which liquids and gases can move through rock. Low-permeability natural gas reservoirs encompass the shale, sandstone, and carbonate formations whose natural permeability is roughly 0.1 millidarcies or below. (Permeability is measured in darcies.)

Energy Market and Economic Impacts of H.R. 2454, the American Clean Energy and Security Act of 2009

Released: August 4, 2009

This report responds to a request from Chairman Henry Waxman and Chairman Edward Markey for an analysis of H.R. 2454, the American Clean Energy and Security Act of 2009 (ACESA). ACESA, as passed by the House of Representatives on June 26, 2009, is a complex bill that regulates emissions of greenhouse gases through market-based mechanisms, efficiency programs, and economic incentives.

 
An Updated Annual Energy Outlook 2009 Reference Case Reflecting Provisions of the American Recovery and Reinvestment Act and Recent Changes in the Economic Outlook

Released: April 21, 2009

This report updates the Reference Case presented in the Annual Energy Outlook 2009 based on recently enacted legislation and the changing macroeconomic environment.

 
Impact of Limitations on Access to Oil and Natural Gas Resources in the Federal Outer Continental Shelf (released in AEO2009)

Released: March 31, 2009

The U.S. offshore is estimated to contain substantial resources of both crude oil and natural gas, but until recently some of the areas of the lower 48 states Outer Continental Shelf (OCS) have been under leasing moratoria. The Presidential ban on offshore drilling in portions of the lower 48 OCS was lifted in July 2008, and the Congressional ban was allowed to expire in September 2008, removing regulatory obstacles to development of the Atlantic and Pacific OCS.

Expectations for Oil Shale Production (released in AEO2009)

Released: March 31, 2009

Oil shales are fine-grained sedimentary rocks that contain relatively large amounts of kerogen, which can be converted into liquid and gaseous hydrocarbons (petroleum liquids, natural gas liquids, and methane) by heating the rock, usually in the absence of oxygen, to 650 to 700 degrees Fahrenheit (in situ retorting) or 900 to 950 degrees Fahrenheit (surface retorting). (Oil shale is, strictly speaking, a misnomer in that the rock is not necessarily a shale and contains no crude oil.) The richest U.S. oil shale deposits are located in Northwest Colorado, Northeast Utah, and Southwest Wyoming. Currently, those deposits are the focus of petroleum industry research and potential future production. Among the three states, the richest oil shale deposits are on federal lands in northwest Colorado.

Bringing Alaska North Slope Natural Gas to Market (released in AEO2009)

Released: March 31, 2009

At least three alternatives have been proposed over the years for bringing sizable volumes of natural gas from Alaska's remote North Slope to market in the lower 48 states: a pipeline interconnecting with the existing pipeline system in central Alberta, Canada; a gas-to-liquids (GTL) plant on the North Slope; and a large liquefied natural gas (LNG) export facility at Valdez, Alaska. The National Energy Modeling System (NEMS) explicitly models the pipeline and GTL options. The what if LNG option is not modeled in NEMS.

Natural Gas and Crude Oil Prices in AEO (released in AEO2009)

Released: March 31, 2009

If oil and natural gas were perfect substitutes in all markets where they are used, market forces would be expected to drive their delivered prices to near equality on an energy-equivalent basis. The price of West Texas Intermediate (WTI) crude oil generally is denominated in terms of barrels, where 1 barrel has an energy content of approximately 5.8 million Btu. The price of natural gas (at the Henry Hub), in contrast, generally is denominated in million Btu. Thus, if the market prices of the two fuels were equal on the basis of their energy contents, the ratio of the crude oil price (the spot price for WTI, or low-sulfur light, crude oil) to the natural gas price (the Henry Hub spot price) would be approximately 6.0. From 1990 through 2007, however, the ratio of natural gas prices to crude oil prices averaged 8.6; and in the Annual Energy Outlook 2009 projections from 2008 through 2030, it averages 7.7 in the low oil price case, 14.6 in the reference case, and 20.2 in the high oil price case.

Economics of Plug-In Hybrid Electric Vehicles (released in AEO2009)

Released: March 31, 2009

Plug-In hybrid electric vehicles (PHEVs) have gained significant attention in recent years, as concerns about energy, environmental, and economic securityincluding rising gasoline prices have prompted efforts to improve vehicle fuel economy and reduce petroleum consumption in the transportation sector. PHEVs are particularly well suited to meet these objectives, because they have the potential to reduce petroleum consumption both through fuel economy gains and by substituting electric power for gasoline use.

California's Move Toward E10 (released in AEO2009)

Released: March 31, 2009

In Annual Energy Outlook 2009, (AEO) E10–a gasoline blend containing 10% ethanol–is assumed to be the maximum ethanol blend allowed in California erformulated gasoline (RFG), as opposed to the 5.7% blend assumed in earlier AEOs. The 5.7% blend had reflected decisions made when California decided to phase out use of the additive methyl tertiary butyl ether in its RFG program in 2003, opting instead to use ethanol in the minimum amount that would meet the requirement for 2.0% oxygen content under the Clean Air Act provisions in effect at that time.

World Oil Prices and Production Trends in AEO2009 (released in AEO2009)

Released: March 31, 2009

The oil prices reported in Annual Energy Outlook 2009 (AEO) represent the price of light, low-sulfur crude oil in 2007 dollars. Projections of future supply and demand are made for "liquids," a term used to refer to those liquids that after processing and refining can be used interchangeably with petroleum products. In AEO2009, liquids include conventional petroleum liquids -- such as conventional crude oil and natural gas plant liquids -- in addition to unconventional liquids, such as biofuels, bitumen, coal-to-liquids (CTL), gas-to-liquids (GTL), extra-heavy oils, and shale oil.

Electricity Plant Cost Uncertainties (released in AEO2009)

Released: March 31, 2009

Construction costs for new power plants have increased at an extraordinary rate over the past several years. One study, published in mid-2008, reported that construction costs had more than doubled since 2000, with most of the increase occurring since 2005. Construction costs have increased for plants of all types, including coal, nuclear, natural gas, and wind.

Clean Air Interstate Rule (released in AEO2009)

Released: March 31, 2009

Clean Air Interstate Rule (CAIR) is a cap-and-trade program promulgated by the Environmental Protection Agency in 2005, covering 28 eastern U.S. states and the District of Columbia. It was designed to reduce sulfur dioxide (SO2) and nitrogen oxide (NOx) emissions in order to help states meet their National Ambient Air Quality Standards (NAAQS) for ozone and particulate matter (PM2.5) and to further emissions reductions already achieved through the Acid Rain Program and the NOx State Implementation Plan call program. The rule was set to commence in 2009 for seasonal and annual NOx emissions and in 2010 for SO2 emissions.

Clean Air Mercury Rule (released in AEO2009)

Released: March 31, 2009

On February 8, 2008, a three-judge panel on the D.C. Circuit of the U.S. Court of Appeals issued a decision to vacate the Clean Air Mercury Rule (CAMR). In its ruling, the panel cited the history of hazardous air pollutant regulation under Section 112 of the Clean Air Act (CAA). Section 112, as written by Congress, listed emitted mercury as a hazardous air pollutant that must be subject to regulation unless it can be proved harmless to public welfare and the environment. In 2000, the Environmental Protection Agency ruled that mercury was indeed hazardous and must be regulated under Section 112 and, therefore, subjected to the best available control technology for mitigation.

New NHTSA CAFE Standards (released in AEO2009)

Released: March 31, 2009

EISA2007 requires the National Highway Traffic Safety Administration (NHTSA) to raise the Corporate Average Fuel Economy (CAFE) standards for passenger cars and light trucks to ensure that the average tested fuel economy of the combined fleet of all new passenger cars and light trucks sold in the United States in model year (MY) 2020 equals or exceeds 35 mpg, 34% above the current fleet average of 26.4 mpg. Pursuant to this legislation, NHTSA recently proposed revised CAFE standards that substantially increase the minimum fuel economy requirements for passenger cars and light trucks for MY 2011 through MY 2015.

Federal Fuels Taxes and Tax Credits (released in AEO2009)

Released: March 31, 2009

Provides a review and update of the handling of federal fuels taxes and tax credits, focusing primarily on areas for which regulations have changed or the handling of taxes or credits has been updated in Annual Energy Outlook 2009.

Energy Improvement and Extension Act of 2008: Summary of Provisions (released in AEO2009)

Released: March 31, 2009

The Emergency Economic Stabilization Act of 2008 (Public Law 110-343), which was signed into law on October 3, 2008, incorporates EIEA2008 in Division B. Provisions in EIEA2008 that require funding appropriations to be implemented, whose impact is highly uncertain or that require further specification by federal agencies or Congress, are not included in Annual Energy Outlook 2009.

Tax Credits and Renewable Generation (released in AEO2009)

Released: March 31, 2009

Tax incentives have been an important factor in the growth of renewable generation over the past decade, and they could continue to be important in the future. The Energy Tax Act of 1978 (Public Law 95-618) established ITCs for wind, and EPACT92 established the Renewable Electricity Production Credit (more commonly called the PTC) as an incentive to promote certain kinds of renewable generation beyond wind on the basis of production levels. Specifically, the PTC provided an inflation-adjusted tax credit of 1.5 cents per kilowatthour for generation sold from qualifying facilities during the first 10 years of operation. The credit was available initially to wind plants and facilities that used closed-loop biomass fuels and were placed in service after passage of the Act and before June 1999.

Loan Guarantee Program Established in EPACT2005 (released in AEO2009)

Released: March 31, 2009

Title XVII of EPACT2005 [20] authorized the Department of Energy (DOE) to issue loan guarantees to new or improved technology projects that avoid, reduce, or sequester greenhouse gases. In 2006, DOE issued its first solicitation for $4 billion in loan guarantees for non-nuclear technologies. The issue of the size of the program was addressed subsequently in the Consolidated Appropriation Act of 2008 (the FY08 Appropriations Act) passed in December 2008, which limited future solicitations to $38.5 billion and stated that authority to make the guarantees would end on September 30, 2009. The legislation also allocated the $38.5 billion cap as follows: $18.5 billion for nuclear plants; $6 billion for CCS technologies; $2 billion for advanced coal gasification units; $2 billion for advanced nuclear facilities for the front end of the nuclear fuel cycle; and $10 billion for renewable, conservation, distributed energy, and transmission/ distribution technologies. DOE also was required to submit all future solicitations to both the House and Senate Appropriations Committees for approval.

State Appliance Standards (released in AEO2009)

Released: March 31, 2009

State appliance standards have existed for decades, starting with Californias enforcement of minimum efficiency requirements for refrigerators and several other products in 1979. In 1987, recognizing that different efficiency standards for the same products in different states could create problems for manufacturers, Congress enacted the National Appliance Energy Conservation Act (NAECA), which initially covered 12 products. The Energy Policy Act of 1992 (EPACT92), EPACT2005, and EISA2007 added additional residential and commercial products to the 12 products originally specified under NAECA.

Updated State Air Emissions Regulations (released in AEO2009)

Released: March 31, 2009

Regional greenhouse gas initiative and western climate initiative descriptions.

Greenhouse Gas Concerns and Power Sector Planning (released in AEO2009)

Released: March 13, 2009

Concerns about potential climate change driven by rising atmospheric concentrations of Greenhouse Gases (GHG) have grown over the past two decades, both domestically and abroad. In the United States, potential policies to limit or reduce GHG emissions are in various stages of development at the state, regional, and federal levels. In addition to ongoing uncertainty with respect to future growth in energy demand and the costs of fuel, labor, and new plant construction, U.S. electric power companies must consider the effects of potential policy changes to limit or reduce GHG emissions that would significantly alter their planning and operating decisions. The possibility of such changes may already be affecting planning decisions for new generating capacity.

Regulations Related to the Outer Continental Shelf Moratoria and Implications of Not Renewing the Moratoria (released in AEO2009)

Released: March 13, 2009

From 1982 through 2008, Congress annually enacted appropriations riders prohibiting the Minerals Management Service (MMS) of the U.S. Department of the Interior from conducting activities related to leasing, exploration, and production of oil and natural gas on much of the federal Outer Continental Shelf (OCS). Further, a separate executive ban (originally put in place in 1990 by President George H.W. Bush and later extended by President William J. Clinton through 2012) also prohibited leasing on the OCS, with the exception of the Western Gulf of Mexico, portions of the Central and Eastern Gulf of Mexico, and Alaska. In combination, those actions prohibited drilling along the Atlantic and Pacific coasts, in the eastern Gulf of Mexico, and in portions of the central Gulf of Mexico. The Gulf of Mexico Energy Security Act of 2006 (Public Law 109-432) imposed yet a third ban on drilling through 2022 on tracts in the Eastern Gulf of Mexico that are within 125 miles of Florida, east of a dividing line known as the Military Mission Line, and in the Central Gulf of Mexico within 100 miles of Florida.

Trends in Heating and Cooling Degree Days: Implications for Energy Demand Issues (released in AEO2008)

Released: September 24, 2008

Weather-related energy use, in the form of heating, cooling, and ventilation, accounted for more than 40% of all delivered energy use in residential and commercial buildings in 2006. Given the relatively large amount of energy affected by ambient temperature in the buildings sector, the Energy Information Administration has reevaluated what it considers normal weather for purposes of projecting future energy use for heating, cooling, and ventilation. The Annual Energy Outlook 2008, estimates of normal heating and cooling degree-days are based on the population-weighted average for the 10-year period from 1997 through 2006.

Distributed Generation in Buildings (released in AEO2005)

Released: September 24, 2008

Currently, distributed generation provides a very small share of residential and commercial electricity requirements in the United States. The Annual Energy Outlook 2005 reference case projects a significant increase in electricity generation in the buildings sector, but distributed generation is expected to remain a small contributor to the sectors energy needs. Although the advent of higher energy prices or more rapid improvement in technology could increase the use of distributed generation relative to the reference case projection, the vast majority of electricity used in buildings is projected to continue to be purchased from the grid.

Impacts of Uncertainty in Energy Project Costs (released in AEO2008)

Released: September 24, 2008

From the late 1970s through 2002, steel, cement, and concrete prices followed a general downward trend. Since then, however, iron and steel prices have increased by 8% in 2003, 10% in 2004, and 31% in 2005. Although iron and steel prices declined in 2006, early data for 2007 show another increase. Cement and concrete prices, as well as the composite cost index for all construction commodities, have shown similar trends but with smaller increases in 2004 and 2005.

EPACT2005 Loan Guarantee Program (released in AEO2008)

Released: June 26, 2008

Title XVII of the Energy Policy Act 2005 (EPACT) authorized the Department of Energy (DOE) to issue loan guarantees for projects involving new or improved technologies to avoid, reduce, or sequester greenhouse gases (GHGs). The law specified that the amount of the guarantee would be up to 80% of a project's cost. EPACT2005 also specified that DOE must receive funds equal to the subsidy cost either through the federal appropriations process or from the firm receiving the guarantee. As discussed in Annual Energy Outlook 2007, this program, by lowering borrowing costs, can have a major impact on the economics of capital-intensive technologies.

Federal Fuels Taxes and Tax Credits (Update) (released in AEO2008)

Released: June 26, 2008

The Annual Energy Outlook 2008 (AEO) reference case incorporates current regulations that pertain to the energy industry. This section describes the handling of federal taxes and tax credits in AEO2008, focusing primarily on areas where regulations have changed or the handling of taxes or tax credits has been updated.

World Oil Prices and Production Trends in AEO2008 (released in AEO2008)

Released: June 26, 2008

Annual Energy Outlook 2008 (AEO) defines the world oil price as the price of light, low-sulfur crude oil delivered in Cushing, Oklahoma. Since 2003, both "above ground" and "below ground" factors have contributed to a sustained rise in nominal world oil prices, from $31 per barrel in 2003 to $69 per barrel in 2007. The AEO2008 reference case outlook for world oil prices is higher than in the AEO2007 reference case. The main reasons for the adoption of a higher reference case price outlook include continued significant expansion of world demand for liquids, particularly in non-OECD (Organization for Economic Cooperation and Development) countries, which include China and India; the rising costs of conventional non-OPEC (Organization of the Petroleum Exporting Countries) supply and unconventional liquids production; limited growth in non-OPEC supplies despite higher oil prices; and the inability or unwillingness of OPEC member countries to increase conventional crude oil production to levels that would be required for maintaining price stability. The Energy Information Administration will continue to monitor world oil price trends and may need to make further adjustments in future AEOs.

Mobile Source Air Toxics Rule (released in AEO2008)

Released: June 26, 2008

On February 9, 2007, the Environmental Protection Agency (EPA) released its MSAT2 rule, which will establish controls on gasoline, passenger vehicles, and portable fuel containers. The controls are designed to reduce emissions of benzene and other hazardous air pollutants. Benzene is a known carcinogen, and the EPA estimates that mobile sources produced more than 70% of all benzene emissions in 1999. Other mobile source air toxics, including 1,3-butadiene, formaldehyde, acetaldehyde, acrolein, and naphthalene, also are thought to increase cancer rates or contribute to other serious health problems.

Energy Independence and Security Act of 2007: Summary of Provisions (released in AEO2008)

Released: June 26, 2008

The Energy Independence and Security Act of 2007 was signed into law on December 19, 2007, and became Public Law 110-140. Provisions in EISA2007 that require funding appropriations to be implemented, whose impact is highly uncertain, or that require further specification by federal agencies or Congress are not included in Annual Energy Outlook 2008 (AEO). For example, the Energy Information Administration (EIA) does not try to anticipate policy responses to the many studies required by EISA2007, nor to predict the impact of research and development (R&D) funding authorizations included in the bill. Moreover, AEO2008 does not include any provision that addresses a level of detail beyond that modeled in the National Energy Modeling System (NEMS), which was used to develop the AEO2008 projections. AEO2008 addresses only those provisions in EISA2007 that establish specific tax credits, incentives, or standards.

State Renewable Energy Requirements and Goals: Update Through 2007 (Update) (released in AEO2008)

Released: June 26, 2008

In recent years, the Annual Energy Outlook (AEO) has tracked the growing number of states that have adopted requirements or goals for renewable energy. While there is no federal renewable generation mandate, the states have been adopting such standards for some time. AEO2005 provided a summary of all existing programs in effect at that time, and subsequent AEOs have examined new policies or changes to existing ones. Since the publication of AEO2007, four states have enacted new renewable portfolio standards (RPS) legislation, and five others have strengthened their existing RPS programs. In total, 25 states and the District of Columbia.

State Regulations on Airborne Emissions: Update Through 2007 (Update) (released in AEO2008)

Released: June 26, 2008

States are moving forward with implementation plans for the Clean Air Interstate Rule (CAIR). The program, promulgated by the EPA in March 2005, is a cap-and-trade system designed to reduce emissions of SO2 and NOx. States originally had until March 2007 to submit implementation plans, but the deadline has been extended by another year. CAIR covers 28 eastern states and the District of Columbia. States have the option to participate in the cap-and trade plan or devise their own plans, which can be more stringent than the federal requirements. To date, no state has indicated an intent to form NOx and SO2 programs with emissions limits stricter than those in CAIR, and it is expected that all states will participate in the Environmental Protection Agency administered cap-and-trade program. CAIR remains on schedule for implementation, and Annual Energy Outlook 2008 includes CAIR by assuming that all required states will meet only the federal requirement and will trade credits.

Liquefied Natural Gas: Global Challenges (released in AEO2008)

Released: June 26, 2008

U.S. imports of liquefied natural gas (LNG) in 2007 were more than triple the 2000 total, and they are expected to grow in the long term as North Americas conventional natural gas production declines. With U.S. dependence on LNG imports increasing, competitive forces in the international markets for natural gas in general and LNG in particular will play a larger role in shaping the U.S. market for LNG. Key factors currently shaping the future of the global LNG market include the evolution of project economics, worldwide demand for natural gas, government policies that affect the development and use of natural resources in countries with LNG facilities, and changes in seasonal patterns of LNG trade.

Limited Electricity Generation Supply and Limited Natural Gas Supply Cases (released in AEO2008)

Released: June 26, 2008

Development of U.S. energy resources and the permitting and construction of large energy facilities have become increasingly difficult over the past 20 years, and they could become even more difficult in the future. Growing public concern about global warming and CO2 emissions also casts doubt on future consumption of fossil fuels -- particularly coal, which releases the largest amount of CO2 per unit of energy produced. Even without regulations to limit greenhouse gas emissions in the United States, the investment community may already be limiting the future use of some energy options. In addition, there is considerable uncertainty about the future availability of, and access to, both domestic and foreign natural gas resources.

Loan Guarantees and the Economics of Electricity Generating Technologies (released in AEO2007)

Released: March 11, 2007

The loan guarantee program authorized in Title XVII of EPACT2005 is not included in the Annual Energy Outlook 2007, because the Federal Credit Reform Act of 1990 requires congressional authorization of loan guarantees in an appropriations act before a federal agency can make a binding loan guarantee agreement. As of October 2006, Congress had not provided the legislation necessary for the Department of Energy (DOE) to implement the loan guarantee program (see Legislation and Regulations). In August 2006, however, DOE invited firms to submit pre-applications for the first $2 billion in potential loan guarantees.

Industrial Sector Energy Demand: Revisions for Non-Energy-Intensive Manufacturing (released in AEO2007)

Released: March 11, 2007

For the industrial sector, the Energy Information Administration's (EIA) analysis and projection efforts generally have focused on the energy-intensive industriesfood, bulk chemicals, refining, glass, cement, steel, and aluminumwhere energy cost averages 4.8% of annual operating cost. Detailed process flows and energy intensity indicators have been developed for narrowly defined industry groups in the energy-intensive manufacturing sector. The non-energy-intensive manufacturing industries, where energy cost averages 1.9% of annual operating cost, previously have received somewhat less attention, however. In Annual Energy Outlook 2006 (AEO), energy demand projections were provided for two broadly aggregated industry groups in the non-energy-intensive manufacturing sector: metal-based durables and other non-energy-intensive. In the AEO2006 projections, the two groups accounted for more than 50% of the projected increase in industrial natural gas consumption from 2004 to 2030.

Energy Demand: Limits on the Response to Higher Energy Prices in the End-Use Sectors (released in AEO2007)

Released: March 11, 2007

Energy consumption in the end-use demand sectorsresidential, commercial, industrial, and transportationgenerally shows only limited change when energy prices increase. Several factors that limit the sensitivity of end-use energy demand to price signals are common across the end-use sectors. For example, because energy generally is consumed in long-lived capital equipment, short-run consumer responses to changes in energy prices are limited to reductions in the use of energy services or, in a few cases, fuel switching; and because energy services affect such critical lifestyle areas as personal comfort, medical services, and travel, end-use consumers often are willing to absorb price increases rather than cut back on energy use, especially when they are uncertain whether price increases will be long-lasting. Manufacturers, on the other hand, often are able to pass along higher energy costs, especially in cases where energy inputs are a relatively minor component of production costs. In economic terms, short-run energy demand typically is inelastic, and long-run energy demand is less inelastic or moderately elastic at best.

Miscellaneous Electricity Services in the Buildings Sector (released in AEO2007)

Released: March 11, 2007

Residential and commercial electricity consumption for miscellaneous services has grown significantly in recent years and currently accounts for more electricity use than any single major end-use service in either sector (including space heating, space cooling, water heating, and lighting). In the residential sector, a proliferation of consumer electronics and information technology equipment has driven much of the growth. In the commercial sector, telecommunications and network equipment and new advances in medical imaging have contributed to recent growth in miscellaneous electricity use.

Electricity Prices in Transition (released in AEO2007)

Released: March 11, 2007

The push by some states to restructure electricity markets progressed rapidly throughout the late 1990s. Although the energy crisis in California during 2000 and 2001 slowed the momentum, 19 states and the District of Columbia currently have some form of restructuring in place. In addition, Washington State, which has not restructured its electricity market, allows its largest industrial customers to choose their suppliers.

Biofuels in the U.S. Transportation Sector (released in AEO2007)

Released: February 22, 2007

Sustained high world oil prices and the passage of the Energy Policy Act 2005 (EPACT) have encouraged the use of agriculture-based ethanol and biodiesel in the transportation sector; however, both the continued growth of the biofuels industry and the long-term market potential for biofuels depend on the resolution of critical issues that influence the supply of and demand for biofuels. For each of the major biofuelscorn-based ethanol, cellulosic ethanol, and biodieselresolution of technical, economic, and regulatory issues remains critical to further development of biofuels in the United States.

Fuel Economy Standards for New Light Trucks (released in AEO2007)

Released: February 22, 2007

In March 2006, the National Highway Traffic Safety Administration (NHTSA) finalized Corporate Average Fuel Economy (CAFE) standards requiring higher fuel economy performance for light-duty trucks in model year (MY) 2008 through 2011. Unlike the proposed CAFE standards discussed in Annual Energy Outlook 2006, which would have established minimum fuel economy requirements by six footprint size classes, the final reformed CAFE standards specify a continuous mathematical function that determines minimum fuel economy requirements by vehicle footprint, defined as the wheelbase (the distance from the front axle to the center of the rear axle) times the average track width (the distance between the center lines of the tires) of the vehicle in square feet.

World Oil Prices in AEO2007 (released in AEO2007)

Released: February 22, 2007

Over the long term, the Annual Energy Outlook 2007 (AEO) projection for world oil prices -- defined as the average price of imported low-sulfur, light crude oil to U.S. refiners -- is similar to the AEO2006 projection. In the near term, however, AEO2007 projects prices that are $8 to $10 higher than those in AEO2006.

Federal and State Ethanol and Biodiesel Requirements (released in AEO2007)

Released: February 22, 2007

The Energy Policy Act 2005 requires that the use of renewable motor fuels be increased from the 2004 level of just over 4 billion gallons to a minimum of 7.5 billion gallons in 2012, after which the requirement grows at a rate equal to the growth of the gasoline pool. The law does not require that every gallon of gasoline or diesel fuel be blended with renewable fuels. Refiners are free to use renewable fuels, such as ethanol and biodiesel, in geographic regions and fuel formulations that make the most sense, as long as they meet the overall standard. Conventional gasoline and diesel can be blended with renewables without any change to the petroleum components, although fuels used in areas with air quality problems are likely to require adjustment to the base gasoline or diesel fuel if they are to be blended with renewables.

Impacts of Rising Construction and Equipment Costs on Energy Industries (released in AEO2007)

Released: February 22, 2007

Costs related to the construction industry have been volatile in recent years. Some of the volatility may be related to higher energy prices. Prices for iron and steel, cement, and concrete -- commodities used heavily in the construction of new energy projects -- rose sharply from 2004 to 2006, and shortages have been reported. How such price fluctuations may affect the cost or pace of new development in the energy industries is not known with any certainty, and short-term changes in commodity prices are not accounted for in the 25-year projections in Annual Energy Outlook 2007. Most projects in the energy industries require long planning and construction lead times, which can lessen the impacts of short-term trends.

Regulation of Emissions from Stationary Diesel Engines (released in AEO2007)

Released: February 22, 2007

On July 11, 2006, the Environmental Protection Agency (EPA) issued regulations covering emissions from stationary diesel engines  New Source Performance Standards that limit emissions of NOx, particulate matter, SO2, carbon monoxide, and hydrocarbons to the same levels required for nonroad diesel engines. The regulation affects new, modified, and reconstructed diesel engines. Beginning with model year 2007, engine manufacturers must specify that new engines less than 3,000 horsepower meet the same emissions standard as nonroad diesel engines. For engines greater than 3,000 horsepower, the standard will be fully effective in 2011. Stationary diesel engine fuel will also be subject to the same standard as nonroad diesel engine fuel, which reduces the sulfur content of the fuel to 500 parts per million by mid-2007 and 15 parts per million by mid-2010.

Coal Transportation Issues (released in AEO2007)

Released: February 22, 2007

Most of the coal delivered to U.S. consumers is transported by railroads, which accounted for 64% of total domestic coal shipments in 2004. Trucks transported approximately 12% of the coal consumed in the United States in 2004, mainly in short hauls from mines in the East to nearby coal-fired electricity and industrial plants. A number of minemouth power plants in the West also use trucks to haul coal from adjacent mining operations. Other significant modes of coal transportation in 2004 included conveyor belt and slurry pipeline (12%) and water transport on inland waterways, the Great Lakes, and tidewater areas (9%).

Impacts of Increased Access to Oil & Natural Gas Resources in the Lower 48 Federal Outer Continental Shelf (released in AEO2007)

Released: February 22, 2007

This analysis was updated for Annual Energy Outlook 2009 (AEO): Impact of Limitations on Access to Oil and Natural Gas Resources in the Federal Outer Continental Shelf (OCS). The OCS is estimated to contain substantial resources of crude oil and natural gas; however, some areas of the OCS are subject to drilling restrictions. With energy prices rising over the past several years, there has been increased interest in the development of more domestic oil and natural gas supply, including OCS resources. In the past, federal efforts to encourage exploration and development activities in the deep waters of the OCS have been limited primarily to regulations that would reduce royalty payments by lease holders. More recently, the states of Alaska and Virginia have asked the federal government to consider leasing in areas off their coastlines that are off limits as a result of actions by the President or Congress. In response, the Minerals Management Service (MMS) of the U.S. Department of the Interior has included in its proposed 5-year leasing plan for 2007-2012 sales of one lease in the Mid-Atlantic area off the coastline of Virginia and two leases in the North Aleutian Basin area of Alaska. Development in both areas still would require lifting of the current ban on drilling.

Alaskan Natural Gas Pipeline Developments (released in AEO2007)

Released: February 22, 2007

The Annual Energy Outlook 2007 reference case projects that an Alaska natural gas pipeline will go into operation in 2018, based on the Energy Information Administration's current understanding of the projects time line and economics. There is continuing debate, however, about the physical configuration and the ownership of the pipeline. In addition, the issue of Alaskas oil and natural gas production taxes has been raised, in the context of a current market environment characterized by rising construction costs and falling natural gas prices. If rates of return on investment by producers are reduced to unacceptable levels, or if the project faces significant delays, other sources of natural gas, such as unconventional natural gas production and liquefied natural gas imports, could fulfill the demand that otherwise would be served by an Alaska pipeline.

State Regulations on Airborne Emissions: Update Through 2006 (Update) (released in AEO2007)

Released: February 22, 2007

In May 2005, the Environmental Protection Agency published two final rules aimed at reducing emissions from coal-fired power plants. The Clean Air Interstate Rule (CAIR) requires 28 states and the District of Columbia to reduce emissions of SO2 and/or NOx. The Clean Air Mercury Rule (CAMR) requires the states to reduce emissions of mercury from new and existing coal-fired plants.

EPACT2005: Status of Provisions (Update) (released in AEO2007)

Released: February 22, 2007

The Energy Policy Act 2005 (EPACT) was signed into law by President Bush on August 8, 2005, and became Public Law 109-058. A number of provisions from EPACT2005 were included in the Annual Energy Outlook 2006 (AEO) projections. Many others were not considered in AEO2006particularly, those that require funding appropriations or further specification by federal agencies or Congress before implementation.

Federal Fuels Taxes and Tax Credits (released in AEO2007)

Released: February 22, 2007

The Annual Energy Outlook 2007 (AEO) reference case and alternative cases generally assume compliance with current laws and regulations affecting the energy sector. Some provisions of the U.S. Tax Code are scheduled to expire, or may be subject to adjustment, before the end of the projection period. In general, scheduled expirations and adjustments provided in legislation or regulations are assumed to occur, unless there is significant historical evidence to support an alternative assumption. This section examines the AEO2007 treatment of three provisions that could have significant impacts on U.S. energy markets: the gasoline excise tax, biofuel (ethanol and biodiesel) tax credits, and the production tax credit for electricity generation from certain renewable resources.

State Renewable Energy Requirements and Goals: Update Through 2006 (Update) (released in AEO2007)

Released: February 22, 2007

Annual Energy Outlook 2006 provided a review of renewable energy programs that were in effect in 23 states at the end of 2005. Since then (as of September 1, 2006), no new state programs have been adopted; however, several states with renewable energy programs in place have made changes as they have gained experience and identified areas for improvement. Revisions made over the past year range from clarification or modification of program definitions, such as which resources qualify, to substantial increases in targets for renewable electricity generation or capacity. The following paragraphs provide an overview of substantive changes in the design or implementation of state renewable energy programs.

Mercury Emissions Control Technologies (released in AEO2006)

Released: March 20, 2006

The Annual Energy Outlook 2006 reference case assumes that states will comply with the requirements of the Environmental Protection Agency's new Clean Air Mercury Rule (CAMR) regulation. CAMR is a two-phase program, with a Phase I cap of 38 tons of mercury emitted from all U.S. power plants in 2010 and a Phase II cap of 15 tons in 2018. Mercury emissions in the electricity generation sector in 2003 are estimated at around 50 tons. Generators have a variety of options to meet the mercury limits, such as: switching to coal with a lower mercury content, relying on flue gas desulfurization or selective catalytic reduction equipment to reduce mercury emissions, or installing conventional activated carbon injection (ACI) technology.

State Restrictions on Methyl Tertiary Butyl Ether (released in AEO2006)

Released: February 1, 2006

By the end of 2005, 25 states had barred, or passed laws banning, any more than trace levels of methyl tertiary butyl ether (MTBE) in their gasoline supplies, and legislation to ban MTBE was pending in 4 others. Some state laws address only MTBE; others also address ethers such as ethyl tertiary butyl ether (ETBE) and tertiary amyl methyl ether (TAME). Annual Energy Outlook 2006 assumes that all state MTBE bans prohibit the use of all ethers for gasoline blending.

Changing Trends in the Refining Industry (released in AEO2006)

Released: February 1, 2006

There have been some major changes in the U.S. refining industry recently, prompted in part by a significant decline in the quality of imported crude oil and by increasing restrictions on the quality of finished products. As a result, high-quality crudes, such as the West Texas Intermediate (WTI) crude that serves as a benchmark for oil futures on the New York Mercantile Exchange (NYMEX), have been trading at record premiums to the OPEC (Organization of the Petroleum Exporting Countries) Basket price.

State Air Emission Regulations That Affect Electric Power Producers (Update) (released in AEO2006)

Released: February 1, 2006

Several states have recently enacted air emission regulations that will affect the electricity generation sector. The regulations govern emissions of NOx, SO2, CO2, and mercury from power plants.

Energy Technologies on the Horizon (released in AEO2006)

Released: February 1, 2006

A key issue in mid-term forecasting is the representation of changing and developing technologies. How existing technologies will evolve, and what new technologies might emerge, cannot be known with certainty. The issue is of particular importance in Annual Energy Outlook 2006 (AEO), the first AEO with projections out to 2030.

World Oil Prices in AEO2006 (released in AEO2006)

Released: February 1, 2006

World oil prices in the Annual Energy Outlook 2006 (AEO) reference case are substantially higher than those in the AEO2005 reference case. In the AEO2006 reference case, world crude oil prices, in terms of the average price of imported low-sulfur, light crude oil to U.S. refiners, decline from current levels to about $47 per barrel (2004 dollars) in 2014, then rise to $54 per barrel in 2025 and $57 per barrel in 2030. The price in 2025 is approximately $21 per barrel higher than the corresponding price projection in the AEO2005 reference case.

Economic Effects of High Oil Prices (released in AEO2006)

Released: February 1, 2006

The Annual Energy Outlook 2006 projections of future energy market conditions reflect the effects of oil prices on the macroeconomic variables that affect oil demand, in particular, and energy demand in general. The variables include real gross domestic product (GDP) growth, inflation, employment, exports and imports, and interest rates.

California Greenhouse Gas Emissions Standards for Light-Duty Vehicles (Update) (released in AEO2006)

Released: February 1, 2006

The state of California was given authority under the Clean Air Act Amendments of 1990 (CAAA90) to set emissions standards for light-duty vehicles that exceed federal standards. In addition, other states that do not comply with the National Ambient Air Quality Standards (NAAQS) set by the Environmental Protection Agency under CAAA90 were given the option to adopt Californias light-duty vehicle emissions standards in order to achieve air quality compliance. CAAA90 specifically identifies hydrocarbon, carbon monoxide, and NOx as vehicle-related air pollutants that can be regulated. California has led the nation in developing stricter vehicle emissions standards, and other states have adopted the California standards.

Proposed Revisions to Light Truck Fuel Economy Standard (released in AEO2006)

Released: February 1, 2006

In August 2005, the National Highway Traffic Safety Administration (NHTSA) published proposed reforms to the structure of CAFE standards for light trucks and increases in light truck Corporate Average Fuel Economy (CAFE) standards for model years 2008 through 201. Under the proposed new structure, NHTSA would establish minimum fuel economy levels for six size categories defined by the vehicle footprint (wheelbase multiplied by track width), as summarized in Table 3. For model years 2008 through 2010, the new CAFE standards would provide manufacturers the option of complying with either the standards defined for each individual footprint category or a proposed average light truck fleet standard of 22.5 miles per gallon in 2008, 23.1 miles per gallon in 2009, and 23.5 miles per gallon in 2010. All light truck manufacturers would be required to meet an overall standard based on sales within each individual footprint category after model year 2010.

Advanced Technologies for Light-Duty Vehicles (released in AEO2006)

Released: February 1, 2006

A fundamental concern in projecting the future attributes of light-duty vehicles-passenger cars, sport utility vehicles, pickup trucks, and minivans-is how to represent technological change and the market forces that drive it. There is always considerable uncertainty about the evolution of existing technologies, what new technologies might emerge, and how consumer preferences might influence the direction of change. Most of the new and emerging technologies expected to affect the performance and fuel use of light-duty vehicles over the next 25 years are represented in the National Energy Modeling System (NEMS); however, the potential emergence of new, unforeseen technologies makes it impossible to address all the technology options that could come into play. The previous section of Issues in Focus discussed several potential technologies that currently are not represented in NEMS. This section discusses some of the key technologies represented in NEMS that are expected to be implemented in light-duty vehicles over the next 25 years.

Nonconventional Liquid Fuels (released in AEO2006)

Released: February 1, 2006

Higher prices for crude oil and refined petroleum products are opening the door for nonconventional liquids to displace petroleum in the traditional fuel supply mix. Growing world demand for diesel fuel is helping to jump-start the trend toward increasing production of nonconventional liquids, and technological advances are making the nonconventional alternatives more viable commercially. Those trends are reflected in the Annual Energy Outlook 2006 projections.

U.S. Greenhouse Gas Intensity and the Global Climate Change Initiative (released in AEO2006)

Released: February 1, 2006

On February 14, 2002, President Bush announced the Administrations Global Climate Change Initiative. A key goal of the Climate Change Initiative is to reduce U.S. greenhouse gas (GHG) intensity-defined as the ratio of total U.S. GHG emissions to economic output-by 18% over the 2002 to 2012 time frame.

Update on Transition to Ultra-Low-Sulfur Diesel Fuel (released in AEO2006)

Released: February 1, 2006

On November 8, 2005, the Environmental Protection Agency (EPA) Administrator signed a direct final rule that will shift the retail compliance date for offering ultra-low sulfur diesel (ULSD) for highway use from September 1, 2006, to October 15, 2006. The change will allow more time for retail outlets and terminals to comply with the new 15 parts per million (ppm) sulfur standard, providing time for entities in the diesel fuel distribution system to flush higher sulfur fuel out of the system during the transition. Terminals will have until September 1, 2006, to complete their transitions to ULSD. The previous deadline was July 15, 2006.

Federal Air Emissions Regulations (released in AEO2006)

Released: February 1, 2006

In 2005, the Environmental Protection Agency (EPA) finalized two regulations, the Clean Air Interstate Rule (CAIR) and the Clean Air Mercury Rule CAMR, that would reduce emissions from coal-fired power plants in the United States. Both CAIR and CAMR are included in the Annual Energy Outlook 2006 reference case. The EPA has received 11 petitions for reconsideration of CAIR and has provided an opportunity for public comment on reconsidering certain aspects of CAIR. Public comments were accepted until January 13, 2006. The EPA has also received 14 petitions for reconsideration of CAMR and is willing to reconsider certain aspects of the rule. Public comments were accepted for 45 days after publication of the reconsideration notice in the Federal Register. Several states and organizations have filed lawsuits against CAMR. The ultimate decision of the courts will have a significant impact on the implementation of CAMR.

Energy Policy Act 2005 Summary (released in AEO2006)

Released: February 1, 2006

The U.S. House of Representatives passed H.R. 6 EH, the Energy Policy Act of 2005, on April 21, 2005, and the Senate passed H.R. 6 EAS on June 28, 2005. A conference committee was convened to resolve differences between the two bills, and a report was approved and issued on July 27, 2005. The House approved the conference report on July 28, 2005, and the Senate followed on July 29, 2005. EPACT2005 was signed into law by President Bush on August 8, 2005, and became Public Law 109-058.

Volumetric Excise Tax Credit for Alternative Fuels (released in AEO2006)

Released: February 1, 2006

On August 10, 2005, President Bush signed into law the Safe, Accountable, Flexible, and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU)]. The act includes authorization for a multitude of transportation infrastructure projects, establishes highway safety provisions, provides for research and development, and includes a large number of miscellaneous provisions related to transportation, most of which are not included in Annual Energy Outlook 2006 because their energy impacts are vague or undefined.

State Renewable Energy Requirements and Goals: Update Through 2005 (Update) (released in AEO2006)

Released: February 1, 2006

Annual Energy Outlook 2005 provided a summary of 17 state renewable energy programs in existence as of December 31, 2003, in 15 states.

Coal Transportation Rate Sensitivity Analysis

Released: April 1, 2005

On December 21, 2004, the Surface Transportation Board (STB) requested that the Energy Information Administration (EIA) analyze the impact of changes in coal transportation rates on projected levels of electric power sector energy use and emissions. Specifically, the STB requested an analysis of changes in national and regional coal consumption and emissions resulting from adjustments in railroad transportation rates for Wyoming's Powder River Basin (PRB) coal using the National Energy Modeling System (NEMS). However, because NEMS operates at a relatively aggregate regional level and does not represent the costs of transporting coal over specific rail lines, this analysis reports on the impacts of interregional changes in transportation rates from those used in the Annual Energy Outlook 2005 (AEO2005) reference case.

 
Impacts of Temperature Variation on Energy Demand in Buildings (released in AEO2005)

Released: April 1, 2005

In the residential and commercial sectors, heating and cooling account for more than 40% of end-use energy demand. As a result, energy consumption in those sectors can vary significantly from year to year, depending on yearly average temperatures.

13 SEER Standard for Central Air Conditioners and Heat Pumps (released in AEO2005)

Released: April 1, 2005

In January 2004, after years of litigation in a case that pitted environmental groups and Attorneys General from 10 states against the U.S. Secretary of Energy, the U.S. Court of Appeals for the Second Circuit reestablished the central air conditioner and heat pump standard originally set in January 200. The Courts ruling, which struck down a May 2002 rollback of the 2001 standard to a 12 Seasonal Energy Efficiency Ratio (SEER) mandates that all new central air conditioners and heat pumps meet a 13 SEER standard by January 2006, requiring a 30% increase in efficiency relative to current law. The Annual Energy Outlook 2005 reference case incorporates the 13 SEER standard as mandated by the Courts ruling.

Production Tax Credit for Renewable Electricity Generation (released in AEO2005)

Released: April 1, 2005

In the late 1970s and early 1980s, environmental and energy security concerns were addressed at the federal level by several key pieces of energy legislation. Among them, the Public Utility Regulatory Policies Act of 1978 (PURPA), P.L. 95-617, required regulated power utilities to purchase alternative electricity generation from qualified generating facilities, including small-scale renewable generators; and the Investment Tax Credit (ITC), P.L. 95-618, part of the Energy Tax Act of 1978, provided a 10% federal tax credit on new investment in capital-intensive wind and solar generation technologies.

Update on State Air Emission Regulations That Affect Electric Power Producers (released in AEO2005)

Released: February 1, 2005

Several states have recently enacted air emission regulations that will affect the electricity generation sector. The regulations are intended to improve air quality in the states and assist them in complying with the revised 1997 National Ambient Air Quality Standards (NAAQS) for ground-level ozone and fine particulates. The affected states include Connecticut, Massachusetts, Maine, Missouri, New Hampshire, New Jersey, New York, North Carolina, Oregon, Texas, and Washington. The regulations govern emissions of NOx, SO2, CO2, and mercury from power plants.

State Renewable Energy Requirements and Goals: Update Through 2003 (released in AEO2005)

Released: February 1, 2005

As of the end of 2003, 15 states had legislated programs to encourage the development of renewable energy for electricity generation. Of the 17 programs (two states have multiple programs), 9 are renewable portfolio standards (RPS), 4 are renewable energy mandates, and 4 are renewable energy goals.

Restricted Natural Gas Supply Case (released in AEO2005)

Released: February 1, 2005

The restricted natural gas supply case provides an analysis of the energy-economic implications of a scenario in which future gas supply is significantly more constrained than assumed in the reference case. Future natural gas supply conditions could be constrained because of problems with the construction and operation of large new energy projects, and because the future rate of technological progress could be significantly lower than the historical rate. Although the restricted natural gas supply case represents a plausible set of constraints on future natural gas supply, it is not intended to represent what is likely to happen in the future.

U.S. Greenhouse Gas Intensity and the Global Climate Change Initiative (released in AEO2005)

Released: February 1, 2005

On February 14, 2002, President Bush announced the Administrations Global Climate Change Initiative. A key goal of the Climate Change Initiative is to reduce U.S. greenhouse gas intensity by 18% over the 2002 to 2012 time frame. For the purposes of the initiative, greenhouse gas intensity is defined as the ratio of total U.S. greenhouse gas emissions to economic output.

Maximum Achievable Control Technology for New Industrial Boilers (released in AEO2005)

Released: February 1, 2005

As part of Clean Air Act 90 (CAAA90, the EPA on February 26, 2004, issued a final rulethe National Emission Standards for Hazardous Air Pollutants (NESHAP) to reduce emissions of hazardous air pollutants (HAPs) from industrial, commercial, and institutional boilers and process heaters. The rule requires industrial boilers and process heaters to meet limits on HAP emissions to comply with a Maximum Achievable Control Technology (MACT) floor level of control that is the minimum level such sources must meet to comply with the rule. The major HAPs to be reduced are hydrochloric acid, hydrofluoric acid, arsenic, beryllium, cadmium, and nickel. The EPA predicts that the boiler MACT rule will reduce those HAP emissions from existing sources by about 59,000 tons per year in 2005.

Military Construction Appropriations and Emergency Hurricane Supplemental Appropriations Act, 2005 (released in AEO2005)

Released: February 1, 2005

H.R. 4837, The Military Construction Appropriations and Emergency Hurricane Supplemental Appropriations Act, 2005, was signed into law on October 13, 2004. The Act provides for construction to support the operations of the U.S. Armed Forces and for military family housing. It also provides funds to help citizens in Florida and elsewhere in the aftermath of multiple hurricanes and other natural disasters. In addition, it authorizes construction of an Alaska Natural Gas Pipeline.

Climate Stewardship Act of 2004 (released in AEO2005)

Released: February 1, 2005

The Climate Stewardship Act of 2004 would establish a system of tradable allowances to reduce greenhouse gas emissions. The bill includes requirements for mandatory emissions reporting by covered entities and for voluntary reporting of emissions reduction activities by noncovered entities; a national greenhouse gas database and registry of reductions; and a research program on climate change and related activities.

Working Families Tax Relief Act of 2004 (released in AEO2005)

Released: February 1, 2005

The Working Families Tax Relief Act of 2004 was signed into law on October 13, 2004. Primarily, the Act reduces taxes for individuals and businesses. At least two provisions relate to energy: Depletion of marginal properties and qualified vehicles.

American Jobs Creation Act of 2004 (released in AEO2005)

Released: February 1, 2005

The American Jobs Creation Act of 2004 was signed into law on October 22, 2004. Most of the 650 pages of the Act are related to tax legislation. Provisions pertaining to energy are detailed in this analysis.

World Oil Price Cases (released in AEO2005)

Released: February 1, 2005

World oil prices in Annual Energy Outlook 2005 are set in an environment where the members of OPEC (Organization of the Petroleum Exporting Countries) are assumed to act as the dominant producers, with lower production costs than other supply regions or countries. Non-OPEC oil producers are assumed to behave competitively, producing as much oil as they can profitability extract at the market price for oil. As a result, the OPEC member countries will be able effectively to set the price of oil when they can act in concert by varying their aggregate production. Alternatively, OPEC members could target a fixed level of production and let the world market determine the price.

Changing Trends in the Bulk Chemicals and Pulp and Paper Industries (released in AEO2005)

Released: February 1, 2005

Compared with the experience of the 1990s, rising energy prices in recent years have led to questions about expectations of growth in industrial output, particularly in energy-intensive industries. Given the higher price trends, a review of expected growth trends in selected industries was undertaken as part of the production of Annual Energy Outlook 2005 (AEO). In addition, projections for the industrial value of shipments, which were based on the Standard Industrial Classification (SIC) system in AEO2004, are based on the North American Industry Classification System (NAICS) in AEO2005. The change in industrial classification leads to lower historical growth rates for many industrial sectors. The impacts of these two changes are highlighted in this section for two of the largest energy-consuming industries in the U.S. industrial sector-bulk chemicals and pulp and paper.

Multi-Pollutant Legislation and Regulations (released in AEO2005)

Released: February 1, 2005

The 108th Congress proposed and debated a variety of bills addressing pollution control at electric power plants but did not pass any of them into law. In addition, the Environmental Protection Agency (EPA) currently is preparing two regulations-a proposed Clean Air Interstate Rule (pCAIR) and a Clean Air Mercury Rule (CAMR)-to address emissions from coal-fired power plants. Several states also have taken legislative actions to limit pollutants from power plants in their jurisdictions. This section discusses three Congressional air pollution bills and the EPA's pCAIR and CAMR regulations.

Clean Air Nonroad Diesel Rule (released in AEO2005)

Released: February 1, 2005

On June 29, 2004, the Environmental Protection Agency issued a comprehensive final rule regulating emissions from nonroad diesel engines and sulfur content in nonroad diesel fuel. The nonroad fuel market makes up more than 18% of the total distillate pool. The rule applies to new equipment covering a broad range of engine sizes, power ratings, and equipment types. There are currently about 6 million pieces of nonroad equipment operating in the United States, and more than 650,000 new units are sold each year.

Fuel Economy of the Light-Duty Vehicle Fleet (released in AEO2005)

Released: February 1, 2005

The U.S. fleet of light-duty vehicles consists of cars and light trucks, including minivans, sport utility vehicles (SUVs) and trucks with gross vehicle weight less than 8,500 pounds. The fuel economy of light-duty vehicles is regulated by the (Corporate Average Fuel Economy) CAFE standards set by the National Highway Traffic Safety Administration. Currently, the CAFE standard is 27.5 miles per gallon (mpg) for cars and 20.7 mpg for light trucks. The most recent increase in the CAFE standard for cars was in 1990, and the most recent increase in the CAFE standard for light trucks was in 1996.

California Greenhouse Gas Emissions Standards for Light-Duty Vehicles (released in AEO2005)

Released: February 1, 2005

In July 2002, California Assembly Bill 1493 (A.B. 1493) was signed into law. The law requires that the California Air Resources Board (CARB) develop and adopt, by January 1, 2005, greenhouse gas emission standards for light-duty vehicles that provide the maximum feasible reduction in emissions. In estimating the feasibility of the standard, CARB is required to consider cost-effectiveness, technological capability, economic impacts, and flexibility for manufacturers in meeting the standard.

Price Responsiveness in the AEO2003 NEMS Residential and Commercial Buildings Sector Models

Released: October 1, 2003

This paper describes the demand responses to changes in energy prices in the Annual Energy Outlook 2003 versions of the Residential and Commercial Demand Modules of the National Energy Modeling System (NEMS). It updates a similar paper completed for the Annual Energy Outlook 1999 version of the NEMS.

 
Measuring Changes in Energy Efficiency for the Annual Energy Outlook 2002

Released: July 1, 2002

This paper describes the methodology used to develop the National Energy Modeling System estimate of projected aggregate energy efficiency and to describe the results of applying it to the Annual Energy Outlook 2002 (AEO2002) reference case.

 
Delivered Energy Consumption Projections by Industry in the Annual Energy Outlook 2002

Released: June 1, 2002

This paper presents delivered energy consumption and intensity projections for the industries included in the industrial sector of the National Energy Modeling System.

 
Methodology for the Assessment of the Macroeconomic Impacts of Stricter CAFE Standards - Addendum

Released: March 1, 2002

This assessment of the economic impacts of Corporate Average Fuel Economy (CAFÉ) standards marks the first time the Energy Information Administration has used the new direct linkage of the DRI-WEFA Macroeconomic Model to the National Energy Modeling System (NEMS) in a policy setting. This methodology assures an internally consistent solution between the energy market concepts forecast by NEMS and the aggregate economy as forecast by the DRI-WEFA Macroeconomic Model of the U.S. Economy.

 
Impacts of Unconventional Gas Technology in the Annual Energy Outlook 2000

Released: November 1, 2000

This paper describes the methodology used in the National Energy Modeling System (NEMS) to represent unconventional gas technologies and their impacts on projections in the Annual Energy Outlook 2000 (AEO2000).

 
Comprehensive Electricity Competition Act: A Comparison of Model Results, The

Released: September 1, 1999

This report describes the Energy Information Administration's use of the National Energy Modeling System (NEMS) to evaluate the effects of the Administration's restructuring proposal using the parameter settings and assumptions from the Policy Office Electricity Modeling System (POEMS) analysis.

 
Issues in Midterm Analysis and Forecasting

Released: August 1, 1999

Final issue of this report. Presents a series of eight papers, which cover topics in analysis and modeling that underlie the Annual Energy Outlook 1999, as well as other significant issues in midterm energy markets. (archived versions)

 

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