The outlook for ethanol and biodiesel is fairly bright, according to the US Energy Information Administration (EIA) in a paper released yesterday. But they will not grow at the expense of other energy sources by 2030, the Authority says.
Despite the rapid growth projected for biofuels and other nonhydroelectric renewable energy sources and the expectation that orders will be placed for new nu-clear power plants for the first time in more than 25 years, oil, coal, and natural gas still are projected to provide roughly the same 86-percent share of the to-tal U.S. primary energy supply in 2030 that they did in 2005 (assuming no changes in existing laws and regulations
But, higher prices and subsidieses for traditional fuels will continue to make alternatives like ethanol and biodiesel competitve:
The use of alternative fuels, such as ethanol, bio-diesel, and CTL, is projected to increase substantially in the reference case as a result of the higher prices projected for traditional fuels and the support for al-ternative fuels provided in recently enacted Federal legislation.
Ethanol use grows in the AEO2007 reference case from 4 billion gallons in 2005 to 14.6 billion gallons in 2030 (about 8 percent of total gasoline con-sumption by volume).
That's not a million miles away from the Corn Refiners Association estimate of 15.5bn.
The ethanol supply is expected to be produced from both corn and cellulose feedstocks, both of which are supported by ethanol tax credits included in the Energy Policy Act of 2005 (EPACT2005),1 but domestically grown corn is ex-pected to be the primary source, accounting for 13.6 billion gallons of ethanol production in 2030.
Second generation fuels will be only taking a small proportion of the total by 2030. Its a government government, its going to be conservative, but possibly too conservative. What do you think?
Alternative sources of distillate fuel oil are projected to be key contributors to total supply (particularly, low-sulfur diesel fuels) in 2030. Consumption of biodiesel, also supported by tax credits in EPACT2005, reaches 0.4 billion gallons in 2030, and distillate fuel oil produced from coal To liquids reaches 5.7 billion gallons in 2030. In total, these two alternative sources of distillate fuel oil account for more than 7 percent of the total distillate pool in 2030.
The AEO2007 reference case also reflects growing market penetration by unconventional vehicle tech-nologies, such as flex-fuel, hybrid, and diesel vehicles. Sales of flex-fuel vehicles, which are capable of using gasoline and E85, reach 2 million per year in 2030, or 10 percent of total sales of new light-duty vehicles. Sales of hybrids, including both full and mild hy-brids,2 are projected to reach 2 million per year by 2030, accounting for another 10 percent of total light-duty vehicles sales. Diesel vehicles sales reach 1.2 million per year in 2030, or 6 percent of new light-duty vehicle sales. Including other alternative vehicle technologies (such as gaseous, electric, and fuel cell), all the projected sales of alternative vehicle technologies account for nearly 28 percent of projected new light-duty vehicle sales in 2030, up from just over 8 percent in 2005.
The EIA looks to be less straight laced than US automakers. Perhaps this is another area where Japanese competition can make inroads.