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EIA's Annual Energy Outlook 2007

The Energy Information Administration just released their Reference Case from the Annual Energy Outlook 2007. Here's the press release titled "New EIA Outlook Reflects Energy Market Shift towards Nuclear, Biofuels, Coal-to-Liquids, and Accelerated Efficiency Improvements" as well as some of the highlights:

The Annual Energy Outlook 2007 (AEO2007) reference case, released today by the Energy Information Administration (EIA), reflects the evolution of energy markets in an era of high prices by projecting growth in nuclear capacity and generation, more biofuels (both ethanol and biodiesel) consumption, growth in coal-to-liquids (CTL) capacity and production, growing demand for unconventional transportation technologies, and accelerated improvements in energy efficiency throughout the economy.

Despite the projected rapid growth of biofuels and other non-hydroelectric renewable energies and the expectation of the first new orders for nuclear power plants in over 25 years, oil, coal, and natural gas are nonetheless projected to provide roughly the same 86 percent share of the total U.S. primary energy supply in 2030 as they did in 2005 absent changes in existing laws and regulations. This reflects a situation in which rapid growth in the use of biofuels and other non-hydro renewable energy sources begins from a very low current share of total energy use, the share of a growing electricity market supplied from nuclear power falls despite projected new plant builds, and hydroelectric power production, which accounts for the bulk of current renewable electricity supply, is stagnant.


Coal is projected to play a growing role in the AEO2007 reference case, particularly for electricity generation. Coal consumption is projected to increase from 22.9 quadrillion British thermal units (quads) in 2005 to over 34 quads in 2030, with significant additions of new coal-fired generation capacity over the last decade of the projection period. The projections for coal use are particularly sensitive to the underlying assumption for the reference case analysis that current energy and environmental policies remain unchanged throughout the projection period.


The AEO2007 reference case projects that total operable nuclear generating capacity will grow to 112.6 gigawatts in 2030, including 3 gigawatts of additional capacity uprates, and 12.5 gigawatts of new capacity stimulated in part by EPACT2005 tax credits and rising fossil fuel prices rise (Figure 1). Total nuclear generation is projected to grow from 780 billion kilowatthours in 2005 to 896 billion kilowatthours in 2030, but the nuclear share of generation falls from 20 percent in 2005 to 15 percent in 2030.

For the early release, click here. The overall projections, in my opinion, are fairly realistic. As of right now, I am guessing that about 15-20 GW of new nuclear capacity will come online between now and 2030. But that's as of right now and I bet in 5-10 years there will still be companies announcing intentions for new plants bringing projections even higher. My forecast is greater than AEO's 12.5 GW but I'll give it to them considering they've substantially improved their nuclear projections quite a bit over the past few years. Last year's AEO 2006 forecasted only 6 GW of new nuclear capacity and previous editions showed no new capacity at all.

What stands out most to me from the AEO is the huge demand for coal for electricity generation after 2020. If some of you are thinking that's a bit unrealistic you're not far off. The AEO does not take into account any carbon policies that may come into existence here in the U.S. The report is a business-as-usual projection and will account for a carbon policy as soon as it comes into existence. Until then, coal is our primary choice for new electrical capacity.

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Jim Hopf said…
Yes, EIA's forecasts are always improving, but they always remain maddeningly behind the curve. Over 30 GWd of nuclear proposed has been proposed even now, coming on line between 2015 and 2020 (versus 12.5 GW by 2030). They basically predict that the nuclear provisions of 2005 will fail to jump start the industry, and that only the initial subsidized plants will be built.

This is all a symptom of their annoying habit of assuming no future policy changes in their primary (or "reference") forecast, even if significant policy changes are far more likely than not to occur. At a minimum, they should present a CO2-limited case along with their no-policy case, with each being given equal standing/emphasis in the "official results".

My own projection? By 2030 there will be at least ~200 GW of nuclear capacity (conservative low estimate), with ~300 GW being more likely.

Sure, if we continue to allow non-IGCC coal plants to be built and place no controls or penalties on CO2, then coal will be somewhat cheaper than nuclear, and EIA will be roughly right. But there is little chance of that happening. And given that CO2 limits are imposed, many people can't seem to grasp how that will affect the outcome. Instead of increasing 50%, coal will have to actually decline. Where is all that energy going to come from? The other factor, unacconted for by EIA, is the fact that by 2030, both oil and gas will have peaked (in production), greatly escalating their price and virtually requiring reducing their usage (in absolute terms) for power generation).

We built ~100 plants over a ~10-15 year period ~30 years ago. Why is it so hard to imagine building 100 or 200 plants over a 25 year period? Economically, even the numbers I project will be a far SMALLER undertaking than the first wave was, given that our GDP is now far larger, and the fact that, due to all we've learned over the last few decades, the plants will not be as expensive this time around. On top of this, the impetus (need) for building the plants this time around is greater than it was for the first wave, with the global warming issue and peaking oil and gas production.

How can we build 100-200 new plants? How can we not?! Unless we totally blow off global warming, this WILL happen! Do the math.
Alex Brown said…
It would be virtually impossible to build 200 new nuclear units before 2030. Even IF there was some massive push to build as many new nuclear units as possible there wimply arent enough foundries in the world to produce the nescecarry equipment at that rate, furthermore there are not enough skilled construction workers to build plants that fast, nor enought uranium minning and enriching capacity to fuel them.

And in reality the push will not even be close to as strong as the upper limit possible, utilities will not replace existing coal plants with new ones as that would mean huge losses, the only place for new nuclear units is to replace old coal units that have reached the end of their lifespan, and to add aditional capacity to meet growing demand. Also, nuclear is only usefull as a baseload energy source which is means you would get seriously deminishing returns if you tried to go over 50% of installed capacity. Also, diversity of energy sources is vitaly important, so even new base load power plants will not be 100%, many coal, wind, or maybe natural gas plants would be built that would further take a chunk out of the amount of new nuclear units that would be built.

A more realalistic chain of events would be that construction on several new units starts ~2010, and that they become operational around 2015, assuming they are sucessfull then more plants will likely be built, but I really don't see it as very likely that any more than 50 new plants could be built by 2030 in the most optimistic of circumstances. Maybe 30 would be a reach goal, and 15 would be accurate assuming some problems arise in construction. Of course it is always possible that another Chernobyl disaster happens and nuclear power once again becomes hated worldwide, and then NO new plants will be built.

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