May 13, 2005
The U.S. Department of Energy's Energy Information Administration today released a detailed analysis of policy recommendations made by the National Commission on Energy Policy in its December report, "Ending the Energy Stalemate: A Bipartisan Strategy to Address America's Energy Challenges."
The Energy Information Administration (EIA) study analyzed a number of the NCEP's major recommendations, including the Commission's cap and trade proposal to address climate change and its fuel economy recommendations.
According to EIA, the NCEP climate plan would have the following impacts over the next 20 years:
- Costs to the U.S. economy would be no more than 0.15% of GDP or about $78 per household per year, while overall GDP is projected to grow by 87%;
- Electricity prices would rise by less than 5% relative to forecast levels
- Coal use would grow by 22% by 2025 relative to current levels;
- Natural gas demand is projected to increase by 1.1% by 2025 compared to baseline forecasts;
- Non-hydro renewable electricity generation would rise by 65% by 2025 compared to baseline forecasts.
Other findings from the EIA study include:
- Natural gas use is expected to fall 3.6% in 2025, versus a 1.1% increase under the emissions trading program alone, because of efficiency programs as well as increased renewables and increased deployment of IGCC.
- Petroleum use is expected to fall 7.3% in 2025, compared to forecast levels, because of tighter vehicle fuel efficiency or CAFE standards.
- Reductions in electricity sales of 77 billion kilowatt hours (2%) in 2015 and 163 billion kilowatt hours in 2025 due to improved building and appliance efficiency standards.
- Accelerated deployment of coal-based IGCC facilities to 44 GW from a reference case of 16 GW in 2025.
- Cumulative federal expenditures for tax incentives, research, development, demonstration and deployment of low carbon technologies (IGCC & sequestration, biofuels, renewables, advanced nuclear, efficiency etc) are fully offset by revenue generated from the sale of greenhouse gas permits.
The full EIA analysis can be found at: http://www.eia.doe.gov/oiaf/servicerpt/bingaman/index.html
National Commission on Energy Policy