The United States is “swimming with gas,” says the latest report from the U.S. Energy Information Administration (EIA). Total recoverable reserves of natural gas are much, much more than previously estimated. These gas resources will have a significant impact on the nation’s energy mix over the next 25 years.
In its Annual Energy Outlook for 2011 report, the EIA more than doubled its central reserve estimates; from 353,000bn cubic feet to 827,000bn cubic feet. This is enough to supply the entire gas demand of the United States for 36 years.
Furthermore, the EIA expects the price of natural gas to remain relatively low over the next 25 years. The combination of plentiful reserves, low prices, and high productivity of drilling techniques such as hydraulic fracturing or “fracking” have prompted many companies to invest in liquefied natural gas (LNG) production for export in tankers to meet growing European and Asian demand.
However, low natural gas prices are chipping away at the economic attractiveness of nuclear and wind power investments in the United States. Low electricity prices keeps the U.S. renewable energy industry more dependent on federal subsidy and incentive support. Although clean energy – especially wind – is taking off in countries like China, renewable energy in the United States is expected to rise moderately at best, from 11% today to 14% in 2035.. Read more…