www.eia.govU.S. Energy Information Administration Independent Statistics & Analysis

Fuels Used in Electricity Generation

ForU.S. Nuclear Infrastructure CouncilJune 05, 2013 | Washington, DC

By Adam Sieminski, Administrator

Over time the electricity mix gradually shifts to lower-carbon options, led by growth in natural gas and renewable generation

2

U.S. electricity net generationtrillion kilowatthours

25%

19%

42%

13%

1%

Nuclear

Oil and other liquids

Natural gas

Coal

Renewables

2011 ProjectionsHistory

17%

16%

35%

30%

1%

1993

53%

13%

19%

11%

4%

Source: EIA, Annual Energy Outlook 2013

Adam Sieminski, USNIC June 05, 2013

Key results from the AEO2013 reference case relating to the electric power sector

Adam Sieminski, USNIC June 05, 2013 3

• While coal still remains the largest single source of U.S. electricity generation, it’s role declines as natural gas and renewables pick up increasing market share

• Natural gas production is higher throughout the reference case projection than it was in AEO2012, serving the industrial and power sectors and an expanding export market

• Role of nuclear power in the U.S. generation mix stays relatively steady

• The U.S. becomes a larger exporter of natural gas and coal than was projected in the AEO2012 reference case

• U.S. energy-related carbon dioxide emissions remain more than five percent below their 2005 level through 2040, reflecting increased efficiency and the shift to a less carbon-intensive fuel mix

Adam Sieminski, USNIC June 05, 2013 4

• Changing policies and regulations

• Changing consumer preferences

• Faster / slower economic growth

• Faster / slower technological progress

• Different relative fuel prices

• Technological breakthroughs

Electricity demand: growth in electricity use slows, but still increases by 28% from 2012 to 2040

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percent growth (3-year compounded annual growth rate)

Source: EIA, Annual Energy Outlook 2013

History Projections

2011

Electricity Use

GDP 2.4%

0.9%

2011 – 2040

average

Natural gas and coal prices: coal regains competitive advantage relative to natural gas over time on a national average basis

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ratio of natural gas price to steam coal price

Source: EIA, Annual Energy Outlook 2013

History Projections

2011 2011 dollars per BtuHistory Projections2011

Competitive parity

Energy prices to the electric power sector

Coal

Natural gas

Adam Sieminski, USNIC June 05, 2013

Domestic production of shale gas has grown dramatically over the past few years

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shale gas production (dry)billion cubic feet per day

Sources: LCI Energy Insight gross withdrawal estimates as of April 2013 and converted to dry production estimates with EIA-calculated average gross-to-dry shrinkage factors by state and/or shale play.

New power plant costs: levelized cost of electricity

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costs for new U.S. electricity power plants in 20182011 dollars per megawatthour

Source: EIA, Annual Energy Outlook 2013

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The fuel mix for electricity generation varies widely across U.S. regions (2011)

Source: EIA, Annual Energy Outlook 2013, based on Form EIA-923

 National Average Minimum Maximum

Coal 42% 0% 80%

Natural Gas 25% 2% 87%

Nuclear 19% 0% 41%

Renewables 13% 1% 65%

Oil / Other 1% 0% 5%

Share of Generation by Fuel, 2011

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The projected fuel mix for electricity generation by region (2040)

Source: EIA, Annual Energy Outlook 2013

 National Average Minimum Maximum

Coal 35% 0% 69%

Natural Gas 30% 2% 81%

Nuclear 17% 0% 36%

Renewables 16% 1% 53%

Oil / Other 1% 0% 2%

Share of Generation by Fuel, 2040

Additions to electricity generation capacity, 1985-2040

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U.S. electricity generation capacity additionsgigawatts

Source: EIA Form 860 & EIA, Annual Energy Outlook 2013

Changes in nuclear capacity for the AEO2013 reference case

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gigawatts

Source: EIA, Annual Energy Outlook 2013

Nuclear relevant side cases in AEO2013

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• High/low nuclear

• High/low oil and gas resource

• Small modular reactors (SMRs) ???

• CO2 fee cases

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capacity additionsgigawatts

Source: EIA, Annual Energy Outlook 2013

Planned Unplanned

Nuclear capacity additions in AEO2013 vary under different assumptions

If natural gas prices stay low, coal is permanently displaced as the leading generation source in the near future

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billion kilowatthours

Source: EIA, Annual Energy Outlook 2013

Coal

Natural Gas

Reference

High Oil and Natural Gas Resource

Projections

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capacitygigawatts

Source: EIA, Annual Energy Outlook 2013

Coal

Oil/gas steamNatural gas combined cycle

NuclearNatural gas combustion turbine

Renewable/other

2040

Power sector electricity generation capacity by fuel in five cases, 2011 and 2040

Small Modular Reactors (SMR)

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• SMR technology differs from traditional, large-scale light-water reactor technology in both reactor size and plant scalability

• EIA conducted a side case to evaluate the effect of a shorter construction period on future nuclear capacity expansion

• The case showed that there are potential cost saving from the shorter construction periods but uncertainty about potential future operations costs remains.

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Changing electricity generation mix in AEO2013 reference case and carbon fee allowance side casesU.S. electricity net generationtrillion kilowatthours

Source: EIA, Annual Energy Outlook 2013

2013 Reference Case

Natural gas

Renewables

Nuclear

Coal

2011

24%

13%

19%

42%

30%

16%

17%

35%

Natural gas

$15 Carbon Fee

Renewables

Nuclear

Coal

34%

22%

27%

16%

$25 Carbon Fee

Natural gas

Renewables

Nuclear

Coal

34%

23%

38%

4%

U.S. dependence on imported liquids depends on both supply and demand

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U.S. liquid fuel supplymillion barrels per day

Source: EIA, Annual Energy Outlook 2013 and Short-Term Energy Outlook, April 2013

Consumption

Domestic supply

Net imports

37%

ProjectionsHistory

Petroleum Exports

-8%

32% STEO forecast for 2014

2014

40%

2012

Adam Sieminski, USNIC June 05, 2013

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Keynote Speakers

Dr. Ernest J. MonizU.S. Secretary of Energy

Lisa MurkowskiUnited States Senator

Alaska

Thomas FanningChairman, President and CEO

Southern Company

Aldo Flores-QuirogaSecretary GeneralInternational Energy Forum

Hans RoslingChairmanGapminder

EIA.gov

For more information

Adam Sieminski, USNIC June 05, 2013 21

U.S. Energy Information Administration home page | www.eia.gov

Annual Energy Outlook | www.eia.gov/forecasts/aeo

Short-Term Energy Outlook | www.eia.gov/forecasts/steo

International Energy Outlook | www.eia.gov/forecasts/ieo

Today In Energy | www.eia.gov/todayinenergy

Monthly Energy Review | www.eia.gov/totalenergy/data/monthly

Annual Energy Review | www.eia.gov/totalenergy/data/annual