America’s Energy Future: Challenges and Opportunities

1. America’s Energy Future:Challenges and Opportunities Maxine L. Savitz Ju December 6, 2010 University of Miami

2. Key Forces Shaping U.S. Energy Situation • Increasing world energy demand stemming from economic globalization, particularly in developing nations, and especially China, tightens energy markets. • U.S. oil imports comprise nearly 60 percent of the U.S. oil use, up from 40 percent in 1990—alternatives are limited. • Energy price volatility has been unprecedented in last two years, continuing to complicate market decisions. • Long term reliability of traditional energy sources, especially oil, is uncertain and will continue to be so. • Mounting concerns about global climate change, largely from burning fossil fuels that provide most world energy, are increasingly a significant factor in energy decisions. • U.S. Energy infrastructure is massive and slowly adapts to change and vulnerable to natural disasters and terrorism.

3. Total Energy Use Projections for Selected Countries: 2006 and 2009 Projections U.S. and China energy use will be the same in 2014 Source: Energy Information Administration, International Energy Outlook

4. Energy Intensity of the U.S. Economy*Relative to 1970 levels Energy Efficiency and Economic Structural Change

5. America’s Energy Future: Technology Opportunities, Risks, and Tradeoffs July 29, 2009 http://www.nationalacademies.org/energy October 2008 May 20, 2009 June 15, 2009 December 9, 2009

6. Key Objectives of America’s Energy Future (AEF) “Foundational Study” (Phase 1) • Provide transparent and authoritative estimates of the current contributions and future potential of existing and new energy supply and demand technologies, impacts and costs, focusing on the next two decades. • Resolve conflicting analyses. To facilitate a productive national policy dialogue about the nation’s energy future

7. Finding 1: Potential for Transformational Change With a sustained national commitment, the United States could obtain substantial energy-efficiency improvements, new sources of energy, and reductions in greenhouse gas emissions through the accelerated deployment of existing and emerging energy-supply and end-use technologies. “Bucket 1” “Bucket 2” “Bucket 3”

8. Finding 2: Energy Efficiency Potential The deployment of existing energy-efficiency technologies is the nearest-term and lowest-cost option for moderating our nation’s demand for energy, especially over the next decade. 15 Percent (15-17 Quads) by 2020 30 Percent (32-35 Quads) by 2030 NOTE: Even greater savings would be possible with more aggressive policies and incentives.

9. Finding 3: Electricity Supply Options The United States has many promising options for obtaining new supplies of electricity and changing its supply mix during the next two to three decades, especially if carbon capture and storage (CCS) and evolutionary nuclear technologies can be deployed at required scales. However, the deployment of these new supply technologies is very likely to result in higher consumer prices for electricity.

10. Levelized Cost of Electricity Generation

11. Finding 5: Continued Dependence on Oil Petroleum will continue to be an indispensable transportation fuel through at least 2035. EIA Reference Case through 2030 Transportation Million barrels of gasoline equivalent per day Total Energy Quadrillion Btu per year Reminder: Estimates are not additive

12. Other KeyFindings Expansion and modernization of the nation’s electrical transmission and distribution systems are urgently needed. (Finding 4) Substantial reduction in GHG emissions from the electricity and transportation sectors achievable over the next two to three decades through a portfolio approach. (Finding 6) To enable accelerated deployment of new energy technologies starting 2020, public and private sector will need to perform extensive RD & D over the next decade. (Finding 7) Barriers can delay or prevent accelerated deployment; policy and regulatory actions will be required to overcome the barriers. (Finding 8)

13. U.S. Energy Efficiency Potential(Quadrillions of Btus [quads]) U.S. energy use (2008): 101 quads EIA projected U.S. energy use (2030): 118 quads Energy efficiency savings potential: 35 quads saved Net U.S. 2030 energy use: 83 quads 35 quads/yr savings potential by 2030, saving money & energy

14. Total U.S. Energy Use by Sector, 2008

15. U.S. Delivered Energy Use by Sectors (2007)

16. U.S. Delivered CO2 by Sector

17. Energy Usage in U.S. Residential & Commercial Sectors Growth in Energy Usage in Buildings Could be Reduced 30 Percent from Projected Increase by 2030 (APS Finding 1) Source: American Physical Society (2008), U.S. DOE, EERE, Energy Data Book (2007)

18. Potential Electricity Savings in Commercial and Residential Buildings, 2020 and 2030

19. U.S. Trends in Refrigerator Appliance Efficiency Refrigerator Volume (cubic feet) 1978 CA * 1980 CA * 1987 CA * 1993 NECA * 2001 DOE * • * Standards

20. Cost of Conserved Energy: Residential and Commercial Electricity

21. Advanced Technologies Provide for Additional Energy Efficiency Solid state lighting Advanced windows Integrated cooling systems Sensors and controls Low-energy and zero-net energy new homes Low-energy new commercial buildings

22. Recent New DOE Programs Relevant to Buildings ARPA – E Building Energy Efficiency Through Innovative Thermo Devices Power Electronics HUB: Improved Energy Efficient Building Systems Designs Homestar Retrofit Ramp-up Smart Grid – ARRA Grants

23. U.S. Transportation Energy Consumption by Mode Source: American Physical Society (2008)

24. Energy Price Volatility: An Recent Illustration

25. Fuel Economy of U.S. Light Duty Vehicles and Trucks (1975-2005) Class 6 to 8 trucks Source: American Physical Society (2008)

26. Light Duty Vehicles Dominate the U.S. Vehicle Fleet

27. Relative Fuel Consumption of Future Cars by Power Train

28. Plausible Shares of Advanced Light-Duty Vehicles in the New Vehicle Market by 2020 and 2035

29. The Potential for Energy Efficiency Improvements in Large Vehicles is Very Large Fuel Consumption Benefit Source: Technologies and Approaches to Reducing the Fuel Consumption of Medium- and Heavy-Duty Vehicles, NRC, 2010

30. Costs to Achieve Fuel Economy Improvement Source: Technologies and Approaches to Reducing the Fuel Consumption of Medium- and Heavy-Duty Vehicles, NRC, 2010

31. Total Energy Use in the Industrial Sector (2004)

32. Estimated Energy Savings Due to Energy Efficiency Improvements

33. Cross-sectoral Technologies to Provide Additional Savings Combined heat and power Materials, nanotechnology Alternative feedstocks Steam and process heat Separation Sensors and controls

34. Barriers to Adopting Energy Efficient Technologies Price of energy Lack of information Capital availability Fiscal and regulatory policies Ownership Technical risk Human and psychological factors

35. Estimates of Energy Savings from Major Energy-Efficiency Policies and Programs

36. Per Capita Electricity Consumption in California, New York, and U.S. (1990-2006) Policies and Programs Can Overcome Barriers

37. Summary of Overarching Findings Deployment of energy efficiency technologies is the nearest term and lowest cost option. Savings in electricity from buildings could eliminate the need to add to electricity generation through 2030. Barriers to improving energy efficiency are formidable, need sustained initiative, experience from states. Long-lived capital stock and infrastructure can “lock in” pattern of energy use for decades.

38. Recent Relevant Academy Reports • America’s Energy Future • America’s Climate Choices • TRB Special Report 298: Driving and the Built Environment • Technologies and Approaches to Reducing the Fuel Consumption of Medium and Heavy-Duty Vehicles • www.nationalacademies.org

39. Potential for Cost-Effective Annual U.S. Energy Savings (quadrillions of Btus)