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DOE Sees Rapid Growth in Natural Gas

Darius Dixon
POLITICO
December 16, 2010

The Energy Department foresees a rapid growth in natural gas production over the next 25 years, according to a report from its statistical arm Thursday.

The Energy Information Administration also predicts that U.S. carbon dioxide emissions will rise slowly post-recession, but won’t surpass 2005 levels again until 2027. Carbon dioxide emissions fell 7 percent in 2009.

Natural gas will represent 62 percent of new capacity by 2035, EIA said. The greatest chunk of that should come from shale gas, which has already increased production 14-fold over the last decade.

That finding could give a boost to the natural gas industry, which has been fighting a battle over the use of hydraulic fracturing, or fracking, the technique that has helped the industry grow but brings water quality and other environmental concerns.

The White House is coordinating an administration-wide review of fracking and may force the industry to disclose the chemicals it uses.

This year’s outlook required a number of changes from past years, EIA administrator Richard Newell told reporters Thursday, citing capital costs for new power plant construction and what counts as technically retrievable shale.

EIA found significant increases in the up-front capital costs for coal, nuclear and wind power plants. The new price tag for building new nuclear plants went up 37 percent; wind energy costs went up 21 percent and convention coal, 25 percent.

Nuclear will not have a huge role in the country’s energy future, the report noted. Of the expected 220-gigawatt increase between 2009 and 2035, only 6 gigawatts are projected to come from nuclear. Newell said EIA’s modest estimated increase in coal use — 6 percent of new generation — reflects a reduced interest in coal because of environmental impacts and regulation.