Here’s the Executive Summary of Vladimir’s conclusions, based in large part on a highly developed olfactory system, especially sensitive to the aroma of bovine feces:
- The U.S. economy uses enormous quantities of energy. Even small changes in the fuel mix are difficult to make, and extremely costly if you’re replacing a traditional fuel with a less efficient one. Absent costly policy changes (like Cap and Trade, which is not included in this Outlook), our fuel mix 25 years from now will be much as it is today.
- EIA’s assumptions give renewable energy sources every advantage, leading to a very optimistic projection of the market share of renewable fuels. Even with these advantageous assumptions, renewables account for only twice the share of the 2035 energy picture compared to today’s. (See Slide 21 (at the end of the post) for the best example of the grossly optimistic treatment of renewables in this Outlook.)
- Even in EIA’s Reference Case, the growth in renewables doesn’t make up for the projected growth in energy consumption from population and productivity growth
- Even EIA thinks the U.S. will fall short of the mandated Renewable Fuel Standard (35 billion gallons of ethanol by 2022) that was imposed by the Congress in 2007.
- EIA projects declining future reliance on liquids imports due to biofuels and production growth in the deepwater Gulf of Mexico. These projections seem overly optimistic to me and would suddenly reverse a 40+ year trend of ever-increasing reliance on oil imports. I don’t buy it.
- Natural gas is still being undervalued as an energy source.
- The base case assumption is that the 40 year certifications for nuclear power plants will be increased across the board by 20 years. Given the continued unpopularity of nukes with the green crowd, this assumption seems suspect.
This material has been cross-posted at RedState.com.