Stuck On Oil Dependence

A new report from the Department of Energy shows that by staying the course with our current energy policy we will be increasing our dependence on foreign oil well into the future. Despite the Bush Administration's rhetoric about breaking our addiction, a new energy projection from the DOE's Energy Information Administration says well we be importing 29 percent more petroleum in 2030.

Our overall energy consumption is expected to rise by 34 percent between 2005 and 2030, partly due to today's lack of emphasis on conservation and energy efficiency. While earlier this year the President made the startling claimthat we should "replace more than 75 percent of our oil imports from the Middle East by 2025," the EIA projects that the percentage of petroleum we import will rise from 67 percent in 2005 to 71.7 percent in 2030.

Despite the rapid growth projected for biofuels and other nonhydroelectric renewable energy sources and the expectation that orders will be placed for new nuclear power plants for the first time in more than 25 years, oil, coal, and natural gas still are projected to provide roughly the same 86-percent share of the total U.S. primary energy supply in 2030 that they did in 2005.

Fossil fuels will continue to be the dominant energy source because the report assumes that the consumption of biofuels will slow down compared to the current rate of growth. According to the report, vehicle consumption of ethanol grew by 13.8
percent last year, but the long term growth rate is expected to be just
5.3 percent per year.Ethanol use grows from 4 billion gallons in 2005 to 14.6 billion gallons in 2030, but just 200 million gallons, or 1.4 percent of the total is the form of E85. (So why will be producing millions of flex fuel vehicles?)

The EIA apparently doesn't think much of the potential of cellulosic ethanol as the report estimates that by 2030, 93 percent of the ethanol will be made from corn. The picture for biodiesel isn't any brighter as the total consumption will be just 5.7 billion gallons in 2030. And we'll also be consuming much more coal and natural gas too.

The EIA says these projections are all based on future administrations continuing the current energy policy.

The reference case assumes that current policies affecting the energy sector remain unchanged throughout the projection period. Some possible policy changes—notably, the adoption of policies to limit or reduce greenhouse gas emissions—could change the reference case projections significantly.

That last phrase is the definition of understatement.

So, does anyone think we need a change in policy?