US Greenhouse Gas Emissions Continue Declining - EPA
The EPA recently announced that US greenhouse gas emissions (GHGs) dropped 1.6% from 2010 to 2011, which continues a downward trend that observers believe is due in large part to increasing vehicle fuel economy standards and the large fuel-switching underway by electric utilities from burning coal to natural gas.
The EPA release went on to say that US GHG emissions have declined nearly 7% since 2005 and last August the Energy Information Administration (EIA) found that US CO2 emissions are at their lowest level since 1992.
Overall, the largest sources of GHG emissions come from the utility and transportation sectors at 33% and 28% respectively. The rapid increase in supplies from expanded natural gas production from hydraulic fracturing, and the relatively mild winter of 2011-12, helped push prices to near historic lows last April with prices below $2 per million British thermal units (MMBtu). EIA released a report in January 2013 that found wholesale natural gas prices dropped 31% in 2012 and that annual average prices at the Henry Hub were at their lowest levels since 1999.
Cheap natural gas prices, a growing resource base, and the specter of more stringent EPA air regulations has directed utilities into using more natural gas for baseload electric power generation. Utilities retired about 9,000 megawatts of coal-fired generation in 2012, and EIA estimates that coal provided roughly 38% of the nation's power last year. As recently as 2003, coal provided more than 50% of the nation's baseload power generation - marking a precipitous decline especially for a large energy consuming nation like the US. Energy and environmental analysts suspect this dramatic shift has largely helped reduce US GHG emissions because a conventional natural gas power plant emits about 1/2 of the CO2 as a conventional coal-fired unit.
Increasing fuel economy standards, the 2008-9 Great Recession and continuing weak economic growth have also had major implications for domestic fuel and energy consumption, thus reducing GHG emissions. Total energy consumption is down 5% over the last five years and the US used 9% less energy per $1 of GDP over the same time period, according to a recent article in the New York Times. Last August, the Obama Administration announced its second major increase in domestic vehicle fuel economy standards that will require cars and light trucks to average 35.5 mpg by 2016 and then achieve a 54.5 mpg average by 2025. The Administration estiamtes that over the life of those standards, more than 12 billion barrels of oil will be saved and it will reduce daily oil consumption by 2 million barrels per day by 2025.