Natural Gas Dominates U.S. Energy Projections

Growth in its domestic production will cause natural gas to replace naphtha feedstocks in coming decades while sparking significant expansion of bulk chemical manufacturing, the Department of Energy predicts in its annual outlook report.

Consumption of natural gas and hydrocarbon gas liquids (HGLs) is expected to increase by more than 50% from 2013 levels by 2040, according to the government’s most likely forecasts for the next quarter-century. A main driver of this trend would be growth in U.S. production capacity for methanol and ammonia for fertilizers and in ethylene catalytic crackers, the report says.

“With sustained low HGL prices, the feedstock slate continues to favor HGL at unprecedented levels” over heavy petroleum-based naphtha feedstocks, it adds. DOE’s Energy Information Administration (EIA) released the report on April 14.

“DOE’s projection for continued growth in domestic natural gas production is terrific news for U.S. chemical industry investment,” says the American Chemistry Council, a trade association.

EIA predicts that the U.S. will become a net exporter of natural gas as soon as 2017. The combination of growth in U.S. energy production and only modest increases in demand means reduced reliance on imported energy.

Without considering the impact of a pending Environmental Protection Agency regulation of carbon dioxide emissions from existing power plants, EIA anticipates prices for electricity to grow 18% by 2040. But improved energy efficiency and a shift away from more carbon-intensive fuels to renewable energy sources such as wind and solar will help stabilize U.S. energy-related CO₂ emissions, it adds. Domestic CO₂ emissions are expected to remain below their 2005 level through 2040, the report says.

In a related development, EPA announced on April 15 that U.S. greenhouse gas emissions in 2013 increased 2% over 2012 levels but dropped 9% since 2005.