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Energy Use in Industry

The United States is a highly industrialized country. The industrial sector accounted for about one-third of total U.S. energy consumption in 2017.

Industry uses many energy sources

The U.S. industrial sector uses a variety of energy sources including

  • Natural gas
  • Petroleum, such as distillate and residual fuel oils and hydrocarbon gas liquids
  • Electricity
  • Renewable sources, mainly biomass such as pulping liquids (called black liquor) and other residues from paper making and residues from agriculture, forestry, and lumber milling operations
  • Coal and coal coke

Most industries purchase electricity from electric utilities or independent power producers. Some industrial facilities generate electricity for use at their plants using fuels that they purchase or the residues from their industrial processes. A few produce electricity with solar photovoltaic systems located on their properties. Some of them sell some of the electricity that they generate.

Industry uses fossil fuels and renewable energy sources for

  • Heat in industrial processes and space heating in buildings
  • Boiler fuel to generate steam or hot water for process heating and generating electricity
  • Feedstocks (raw materials) to make products such as plastics and chemicals

The industrial sector uses electricity for operating industrial motors and machinery, lights, computers, and office equipment and for facility heating, cooling, and ventilation equipment.

Energy use by type of industry

Every industry uses energy, but three industries account for most of the total U.S. industrial sector energy consumption. The U.S. Energy Information Administration estimates that in 2017, the bulk chemical industry was the largest industrial consumer of energy, followed by the refining industry and the mining industry. These three industries combined accounted for about 58% of total U.S. industrial sector energy consumption.

Energy sources used as feedstocks

Some manufacturers use energy sources as feedstocks—raw materials—in their manufacturing processes. (Manufacturers are a subset of the industrial sector, which includes manufacturing, agriculture, construction, forestry, and mining.) For example, hydrocarbon gas liquids (HGL) are feedstocks for making plastics and chemicals. According to the 2014 Manufacturing Energy Consumption Survey (MECS), feedstocks accounted for about 5.3 quadrillion British thermal units (Btu), or about 28%, of total first use of energy by U.S. manufacturers in 2014.1

Feedstock use by manufacturers by type of feedstock, amount (in trillion Btu (TBtu)), and share of total manufacturing feedstock use in 2014

  • Hydrocarbon gas liquids—2,363 TBtu—45%
  • Natural gas—554 TBtu—10%
  • Coal—484 TBtu—9%
  • Coke and breeze—81 TBtu—2%
  • Other—1,805 TBtu—34%

Other includes petroleum products such as residual and distillate fuel oils, asphalt, lubricants, waxes, and petrochemicals.

1 Source: U.S. Energy Information Administration, Manufacturing Energy Consumption Survey 2014, Tables 1.2 and 2.2, October 2017

Last updated: July 23, 2018

TThe industrial sector consists of all facilities and equipment used for producing, processing, or assembling goods. The industrial sector includes manufacturing, agriculture (farming), construction, fishing, forestry, and mining (which includes oil and natural gas extraction).

The U.S. Energy Information Administration (EIA) estimates that manufacturing accounted for about 75% of total U.S. industrial sector energy consumption in 2016. EIA conducts the Manufacturing Energy Consumption Survey (MECS) to collect detailed information on energy use and expenditures and other data by U.S. manufacturing establishments.

Natural gas use by manufacturers is increasing in the United States

According to the 2014 MECS, use of natural gas by the manufacturing sector, as fuel and as nonfuel (feedstock), was higher in 2014 than in 2010. For use as a fuel only, natural gas's share increased from 36.6% in 2010 to 39.3% in 2014. Use of coal and petroleum liquids for fuel by manufacturers was lower in 2014 than in 2010, continuing a trend observed in each MECS from 1998 to 2014.

Electricity use and generation by manufacturers

The amount of electricity used by U.S. manufactures has varied somewhat from the 1998 MECS to the 2014 MECS. However, electricity's share of annual energy use (excluding feedstocks) by manufacturers has been fairly consistent at about 17%. Most of the electricity consumed by manufacturers is purchased, but some manufacturers generate their own electricity onsite (at the location of their facilities).

In 2014, about 96% of the electricity generated onsite by manufacturers was from combined heat and power (CHP) systems, which is about the same proportion as in 2006 and in 2010. Natural gas and coal are the dominant fuels in CHP systems. Electricity generation from noncombustible renewable energy sources (solar, wind, and hydropower) was about 1% of the total amount of electricity generated onsite in U.S. manufacturing in 2014.

Last updated: December 15, 2017