That fact is even more pronounced after looking at our nation’s energy consumption. Based on the EIA’s 2008 figures, petroleum still makes up 37% of total U.S. energy consumption. Coming in second place is natural gas at 24%. Coal is a close third. Renewables are still scraping the bottom, only making up 7% of our total energy consumption.
Over the next decade, those consumption levels are going to change drastically.
In its battle to cut CO2 emissions, the White House came out swinging yesterday. According to a new executive order signed by President Obama, federal agencies are required to, "Measure, manage and reduce greenhouse gas emissions."
"What is the goal", you ask?
The plan is to cut greenhouse gas emissions by 2020. Some of the measures include reducing petroleum use in vehicle fleets by 30%.
No matter how you slice it, we’re still decades away from change; and from the way things are shaping up, it’s hard not to see a natural gas rebound in the near future. At the moment, it’s our only real successor to oil’s energy throne, at least until renewables can overcome the scaling problem.
A few weeks ago, BP reiterated that idea. Addressing a Financial Times’ energy conference, Lamar Mckay, president of BP Americas said, "Natural gas has the greatest potential to provide the largest carbon reductions at the lowest cost using technology that is available today."
Are you really surprised to hear BP pushing for natural gas? After all, they happen to be one of the world’s natural gas producers. Of course, they’re also correct. A typical coal-fired power plant emits 60% more CO2 than natural gas powered plants.
Back in July, my colleague, Chris Nelder, gave you a heads-up with his natural gas forecast. Since then, prices have rallied, reaching as high as $5.12 per Mcf during trading today.
Personally, I think it’s only a matter of time.
Until next time,