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Front Page » February 14, 2002 » Local News » Doe Forecast Predicts Expanding Demand for Western Coal
Published 4,690 days ago

Doe Forecast Predicts Expanding Demand for Western Coal


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Last year, the United States experienced extremely volatile energy markets.

Following the September terrorist attacks, dropping oil and natural gas prices along with nationwide energy shortage concerns produced an economic slowdown.

But despite the 2001 slowdown, the U.S. Department of Energy anticipates no long-term impacts across the nation.

As measured by gross domestic product, the latest DOE outlook report estimates the U.S economy will grow at an average annual rate of 3.0 percent from 2000 to 2020.

Coal production in the U.S. will increase by 1.3 percent annually during the designated period, indicates the DOE energy forecast.

Production totals will climb from 1,084 million tons in 2000 to 1,397 million tons in 2020 as domestic demand grows.

Total coal consumption will jump from 1,081 to 1,365 million tons between 2000 and 2020, representing an average increase of 1.2 percent per year throughout the forecast period.

Expanding production from western coal mining operations will meet the mounting nationwide demand.

The average mine mouth price of coal will drop from $16.45 per ton in 2000 to $12.79 in 2020. Exports will decrease slightly through the forecast period across the nation.

Electricity demand will grow 1.8 percent annually, anticipates the federal agency. Average power prices will decline from 6.9 cents per kilowatt hour in 2000 to 6.5 cents in 2020, according to forecasts. Generation from natural gas, coal and renewable fuels will increase to meet the demand for electricity.

Natural gas' share of the power generation market will rise from 16 percent in 2000 to 32 percent in 2020. Coal's share will decline from 52 percent to 46 percent.

Nuclear generating capacity will decrease - of the 98 gigawatts of nuclear capacity available in 2000, 10 gigawatts will be retired by 2020.

Demand for natural gas will increase 2.0 percent annually, rising from 22.8 to 33.8 trillion cubic feet between 2000 and 2020, estimates the DOE outlook report.

The expanding demand will be primarily due to rapid growth in electricity generation.

Natural gas production will climb an average of 2 percent annually between 2000 and 2020, from 19.1 to 28.5 trillion cubic feet.

The average wellhead natural gas price will reach $3.26 per thousand cubic feet in 2020.

Total energy consumption across the nation is expected to increase more rapidly than domestic production through 2020, continues the DOE forecast report.

As a result, net energy imports will capture a mounting share of the U.S. market.

Total energy consumption will climb from 99.3 to 130.9 quadrillion British thermal units (Btu) between 2000 and 2020, representing an average annual increase of 1.4 percent.

Residential energy consumption will expand 1 percent per year to reach 24.3 quadrillion Btu by the year 2020.

Renewable energy production will increase from 6.5 to 8.9 quadrillion Btu and commercial demand will climb at an average annual rate of 1.7 percent, reaching 23.2 quadrillion Btu in 2020.

Industrial demand will increase at an average rate of 1.1 percent per year, totaling 43.8 quadrillion Btu in 2020.

Industrial gross output should rise 2.6 percent annually, but an anticipated 1.5 percent decrease in energy intensity will partially offset the growth.

Transportation energy demand will grow at an average annual rate of 1.9 percent, climbing to 39.6 quadrillion Btu in 2020, indicates the DOE outlook report.

Petroleum demand will increase 1.5 percent annually through 2020, led by the transportation sector. The sector is expected to account for more than 70 percent of the 2020 demand.

Renewable fuel consumption will expand 1.7 percent per year through 2020, points out the DOE report. Nearly 55 percent of the demand will involve electricity generation.

Between 1970 and 1986, energy intensity declined at an average annual rate of 2.3 percent, explains the federal agency. The decreases moderated to 1.5 percent per year between 1986 and 2000. Intensity will continue to drop 1.5 percent annually through 2020.

Per capita energy use decreased from 1970 through the mid-1980s, rising when prices dropped. Per person use will increase slightly during the forecast period, with efficiency gains only partially offsetting higher demand.

According to the DOE outlook report, U.S. crude oil production will decline at an average annual rate of 0.2 percent from 2000 to 2020 to 5.6 million barrels per day. But petroleum production should increase in the latter half of the forecast .

Steadily mounting demand for petroleum should raise the share of the U.S. marketplace filled by net imports from 53 percent in 2000 to 62 percent in 2020.

The average world oil price dropped from $27.72 per barrel in 2000 to $22.48 in 2001 before beginning a gradual increase in 2002, points out DOE. By 2020, the price should reach $24.68 per barrel.

World petroleum demand should climb from 76.0 million barrels per day in 2000 to 118.9 million barrels by 2020. Expanded production will lead to relatively slow price growth through 2020.

OPEC production is expected to register at 57.5 million barrels per day in 2020, nearly double the 30.9 million barrels per day produced in 2000, assuming sufficient capital to expand production capacity, predicts the DOE energy outlook. Non-OPEC production should expand from 45.7 to 61.1 million barrels per day between 2000 and 2020.

Carbon dioxide emissions from energy use are projected to increase at an average rate of 1.5 percent per year, from 1,562 million metric tons carbon equivalent in 2000 to 2,088 million in 2020, concludes the DOE forecast report.


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