U.S. Forecasts Better Energy Picture in 2001

Demand for electricity in the United States will grow by 1.7 percent this year, compared with 5.3 percent last year, according to government forecasts.

WASHINGTON, DC – The 1.7 percent increase for 2001 is slightly higher than the 1.6 percent growth predicted last month by the U.S. Energy Information Administration in its Short Term Energy Outlook. The growth in 2002 will be 1.8 percent. Demand for electricity is expected to slow as the nation’s economic growth abates, but the cold weather in November and December of last year pushed estimates for heating degree days to be 18 percent above the levels of last winter, says the report. A heating degree-day is the number of degrees needed to maintain room temperature at 65oF. The cold weather forced the agency to increase its predictions for demand in the residential sector, to 6.6 percent from the earlier estimate of 5.0 percent. Sales of electricity from power utilities are expected to increase by 3.9 percent, higher than last month’s prediction of 3.3 percent growth. The demand in the commercial sector was revised down to 3.4 percent from the earlier estimate of 4.8 percent. The dropping price of oil will prompt many utilities to switch back to that fuel from natural gas, and the growth in coal-fired electricity generation in the United States also increased in the last quarter of 2000. A typical home that heats with oil will pay 40 percent more this winter than last year, while homes that use natural gas will see a 70 percent increase. The demand for renewable energy will drop by 0.2 percent this year, following a 0.3 percent decline from 1999 to 2000, explains EIA. Total demand will be 6.986 quadrillion Btu, but will increase by 2.6 percent into 2002 to total 7.165 quadrillion. Among electric utilities, demand for solar, wind and geothermal energy dropped 92 percent last year, largely due to the divestiture of facilities to non-utility generators, but this will increase 33 percent this year and remain static in 2002. At non-utility power generators, the demand for the three renewable energy sources dropped 9.4 percent last year and will decline another 1.5 percent in 2001, and remain static next year. Combined, these three technologies will contribute 0.337 quadrillion Btu to U.S. energy demand this year. By comparison, hydroelectricity and biofuels contribute 3.681 quadrillion Btu, while the total demand in the United States will surpass 100 quadrillion Btu for the first time this year.

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