Biofuels play increasing role in reduced U.S. oil imports & reduced vulnerability

By Jon H. Harsch

© Copyright Agri-Pulse Communications, Inc.



WASHINGTON, Feb. 3 - Blasting U.S. energy policy as “irresponsible,” Senate Energy Committee Ranking Member Lisa Murkowski, R-Alaska, called for balancing investment in clean alternative energy with “greater investment in the fuel we depend on today.” At a Senate Energy Committee hearing Thursday on energy policy, Murkowski said with world oil supplies tightening, the U.S. needs to increase domestic oil and gas production “to protect against supply disruptions, increase our security, restore our trade balance, generate government revenues and, most of all, create jobs.”

Murkowski warned that “Growing demand around the world means Americans will be facing greater competition for the oil we import - and that means higher prices. The best protection we can have against rising prices is increased production here at home. We have the resources. We simply lack the political will.”

The hearing's witnesses confirmed that higher prices are likely. Richard Newell, Administrator of the Energy Department's Energy Information Administration (EIA) said to expect oil to average $93 a barrel this year, up $14 from 2010, and $99 a barrel for 2012, with gasoline averaging $3.17 a gallon this year and $3.29 for 2012.

Unlike Murkowski, Energy Committee Chair Jeff Bingaman, D-N.M., focused on good news. First, he said that despite concerns about the Middle East, “it appears unlikely that the political turmoil will result in major disruptions in oil production or transportation.” He said the lesson from the Egyptian rioting is that this latest reminder of U.S. vulnerability to world oil supply disruptions should spur the U.S. “to consider energy policies that help to reduce that vulnerability.”

Bingaman pointed to the EIA forecast that after peaking in 2005-06, U.S. oil imports should continue to decline - showing that the U.S. has already reduced its dependence on imports. He credited this improved situation to increased vehicle fuel efficiency, increased biofuels use, and increased U.S. oil production. Newell testified that “U.S. dependence on imported liquid fuels, measured as a share of total U.S. liquid fuel use, reached 60% in 2005 and 2006 before falling to 52% in 2009. The liquids import share continues to decline over the projection period, to 42% in 2035.”

Newell confirmed the increased importance of biofuels and other forms of renewable energy, pointing out that “Renewables are the fastest-growing source of world energy supply.” Citing EIA studies, he said “Total consumption of marketed renewable fuels grows by 2.9 percent per year . . Growth in the consumption of renewable fuels results mainly from the implementation of the federal RFS for transportation fuels and state renewable portfolio standard (RPS) programs for electricity generation. Marketed renewable fuels include wood, municipal waste, biomass, and hydroelectricity in the end-use sectors; hydroelectricity, geothermal, municipal waste, biomass, solar, and wind for generation in the electric power sector; and ethanol for gasoline blending and biomass-based diesel in the transportation sector.”

EIA Chart: “Renewables grow rapidly, but fossil fuels still provide 78 percent of U.S. energy use in 2035” (compared with 84 percent in 2009)

 

EIA Chart: “U.S. imports of liquid fuels fall due to increased domestic production - including biofuels - and greater fuel efficiency”


To watch a video of Senator Bingaman listing his energy priorities, click the video play control:

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