Page 8 - Oil & Energy - March 2013

FYI
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8 • OIL&ENERGY
Highlights of interest to NEFI members:
• Yergin said U.S. oil production has increased 38 percent since 2008
and total U.S. production now equals the annual output of Nigeria,
the seventh-largest oil producing state in OPEC.
• Meanwhile, carbon emissions from energy consumption have
dropped 13 percent since 2007.
• Yergin added that energy producers employ 1.2 million, expected
to grow to 3 million by 2020.
• EIA predicts that oil production could surge to 7.9 million barrels
per day (bpd) next year, up from the 2012 level of 6.4 million bpd,
and that the U.S. will surpass Saudi Arabia in oil production by 2020.
• Hutzler said shale oil production has increased 400 percent over 10
years, and is expected to increase at a rate that surpasses shale gas
in the coming years.
• She said 96 percent of increased oil production since 2007 has
come from private lands, where permits are often approved within
a month. Permitting for Federal lands can take six to 12 months.
• Opening federal lands to oil and gas leasing would add $14.4
trillion in economic activity and $3.8 trillion in federal, state and
local tax revenues over 30 years.
• ICF International estimates the U.S. has 264 billion barrels of crude
oil, representing 110 years at current annual production, and is
roughly equivalent to proven reserves of Saudi Arabia.
• Witnesses also touted gas-to-liquids or GTL, a proven technology
that turns natural gas into market-ready distillate fuels and at a
competitive cost. Unlike compressed or liquefied natural gas, GTL
fuels would be able to utilize the existing liquid fuels infrastructure.
• A major GTL project is already under way in Louisiana. NEFI has
previously reported that if this project comes online in 2018 as
expected, it will have a 96,000 bpd capacity.
“The unconventional revolution has unfolded pretty fast,” Dr. Yergin
said. “[The Energy & Commerce Committee] has held many important
hearings on energy over the decades. Yet it is striking to think back to
the hearings of even just half a decade ago, during the turmoil of
2008, when it was widely assumed that a permanent era of energy
shortage was at hand… how different things look today.”
Affordable Energy Advocates Press Kerry on Keystone XL
The Consumer Energy Alliance (CEA) has urged newly confirmed
U.S. Secretary of State John Kerry to approve the vital TransCanada
Keystone XL pipeline, which once constructed would create
thousands of new jobs and ultimately ship around 800,000 barrels per
day of North American Crude oil to U.S. refineries. “Keystone XL is part
of a broader transition toward North American energy self-sufficiency
– a revolution that will have profound effects on U.S. foreign relations
and global geopolitics,” CEA said. They added that increased access to
domestic energy supplies “coupled with greater adoption of energy
efficiency, conservation, and renewable energy can eliminate the
need for foreign imports within this decade.”
The CEA is a nonprofit, nonpartisan organization that supports the
thoughtful utilization of energy resources to help ensure improved
domestic and global energy security and stable prices for consumers.
NEFI is an active member of the CEA and has partnered with the
group in support of Keystone XL. Final approval of the pipeline rests in
the hands of the Obama administration, and more specifically, the
Department of State, because the northern tier of the pipeline crosses
the US-Canada border. The project has now been delayed for a total of
1,607 days. Politico has reported that the administration may
ultimately approve the pipeline, which would be a win for energy
advocates, while simultaneously capping carbon emissions from
power plants in order to appease climate activists.
Supporters in the U.S. House of Representatives have introduced
legislation that would force the President’s hand on the issue, but
even if a bill is approved by the House it is unlikely to be taken up by
the Democrat-controlled Senate. A final decision on the Keystone XL
pipeline is not expected before April, and the administration has
indicated it may not be announced until June. NEFI continues to
support the pipeline and opposes any further delays.
New FTC Rule Requires Regional Energy
Efficiency Labels for Certain HVAC Equipment
The Federal Trade Commission is issuing changes to its Energy
Labeling Rule, which will add regional information to the familiar
yellow EnergyGuide label on residential furnaces and central air
conditioners. The additional information on the new labels, including
a map, will help consumers and businesses install equipment
appropriate for their location under new Department of Energy (DOE)
regional efficiency standards. The new DOE regional standards are
mandated by the Energy Policy and Conservation Act, which also
directs the FTC to create disclosures related to those standards. Unlike
existing DOE standards, which impose uniform, national efficiency
levels for heating and cooling equipment, the new standards vary by
region for certain products.
The new DOE requirements impose regional efficiency standards
for four product categories: split system air conditioners, single-
package air conditioners, non-weatherized gas furnaces, and mobile
home gas furnaces. For all other covered heating and cooling
equipment, the new standards are nationally uniform. In addition, DOE
has not changed existing standards for boilers and electric furnaces.
DOE has scheduled two compliance dates for the new standards:
May 1, 2013, for non-weatherized gas furnaces, mobile home gas
furnaces, and non-weatherized oil furnaces; and January 1, 2015,
for weatherized gas furnaces and all central air conditioners and heat
pumps. However, a pending federal court settlement relating to the
regional standards for furnaces may delay the May 2013 compliance
date for those standards. The final Rule requires the EnergyGuide label
on product packaging, at the point of sale, and on websites and the
products themselves. NEFI is examining the final rule closely and will
draft a compliance bulletin for members.