John C. Felmy Chief Economist and Director Policy Analysis and Statistics American Petroleum Institute June 1, 2002 North American Economic.

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Presentation transcript:

John C. Felmy Chief Economist and Director Policy Analysis and Statistics American Petroleum Institute June 1, 2002 North American Economic and Petroleum Outlook

What is needed in a Comprehensive National Energy Policy? Conservation and energy efficiency are important but are insufficient to meet our future needs. Renewable energy is an important but small source of energy. Until it’s cost is reduced, it will continue to be a small source. Even with improved efficiency and more renewable energy, we will still need more conventional energy – oil, coal, natural gas and nuclear.

Renewable energy 2000

Regulatory Avalanche

EIA Forecast to 2020 Real Gross Domestic Product is projected to increase by 79 percent Total energy consumption is forecasted to increase by 32 percent Petroleum demand is projected to increase by 35 percent Natural gas demand is projected to increase by 48 percent Coal demand is projected to increase by 22 percent Electricity demand is projected to increase by 43 percent Renewable energy supply is projected to increase by 38 percent Nuclear energy is projected to decline by 7 percent Energy efficiency (output per unit of energy) is projected to improve by 26 percent

EIA Forecast to 2020 Net petroleum imports are projected to increase, providing 62 percent of U.S. demand in Growth in petroleum demand is led by transportation, where efficiency improvements are more than offset by growing travel demand and petroleum’s market share increases slightly. Crude oil production falls by 3 percent. Imports of crude oil grow by 24 percent. Petroleum product imports increase by 169 percent. Refinery capacity expands from 16.6 to 18.2 million barrels per day

Climate Change – What is happening?

Recommendations R&D in Energy Efficiency and Renewable Energy Promotion of energy saving using existing programs such as EPA’s Energy Star Adequately fund LIHEAP and Weatherization Expand the Strategic Petroleum Reserve Develop new domestic sources of oil and natural gas Streamline regulations for energy infrastructure development Reform unilateral economic sanctions Reform tax code to align it with economic reality Educate Americans on the realities of energy use and production Robustness, Redundancy and Diversity