Friday, September 7, 2012

Stunning Facts: US Oil & Coal Consumption Dropping To 1990 and 1985 Levels Respectively

Remarkable changes in the usage of different energy sources are reshaping how America powers itself.

America is consuming less coal and oil than it was 20 to 30 years ago, while natural gas and non-hydro renewable energy set new records for both consumption and production.  See Section 2 at page 21: As the usage of competing fuels changes, total energy consumption declines and will likely drop to 1998 or 1999 levels this year, making the energy business intensely competitive.

Unlike in most of the world, US coal consumption is falling, down about 18% in the first 5 months of 2012, compared to the same period in 2011.  This year coal consumption may fall to 1985 or before levels (see Table 6.2 in the EIA data).  The decline in coal consumption is a direct result of natural gas displacing coal to generate electricity.

Oil demand is down too in the US and is on track to decline another 2% compared to last year.  US oil consumption likely will be at 1990 or 1991 levels in 2012.

Though the US is consuming substantially less oil than it did in the peak year of 2007, US oil production is roaring.  The result of less oil consumption and more production is a significant drop in US oil imports.

As consumption of coal and oil falls in the USA, natural gas set records for consumption in 2010, 2011, and may do so again in 2012, though so far it has registered just a 1% increase in 2012, much less than one would expect given its success in capturing electricity generation market share.  In fact, The 2012 increase in natural gas consumption is not nearly enough to absorb the enormous new shale gas production.  Hence natural gas prices have been persistently low in 2012.

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