Today’s Key Takeaways: Lots of misinformation being spread about Alaska’s proposed CCUS program – details below. Global liquid fuels consumption projected to hit 102MM barrels per day in 2024. Investment boom for U.S. LNG nears. Copper supply shortage will slow the energy transition. Gas stove fiasco is not over.
NEWS OF THE DAY:
On Friday, February 10th, HB 50, Governor Dunleavy’s legislation supporting CCUS, was heard in the House Resources committee. You can watch the entire presentation by clicking on the link above and review all of the supporting documents. Here is a quick tutorial on the basics:
Demand Projected to Hit More Than 102MM Barrels Per Day in 2024
Andreas Exarheas, Rigzone, February 13, 2023
The U.S. Energy Information Administration expects global liquid fuels consumption to increase by 1.1 million barrels per day in 2023 and by 1.8 million barrels per day in 2024, according to its latest short term energy outlook (STEO).
Total world consumption will hit 100.47 million barrels per day this year and 102.26 million barrels per day in 2024, the February STEO projected. The STEO showed that demand is expected to hit 99.65 million barrels per day in the first quarter of this year, 100.05 million barrels per day in the second quarter, 100.99 million barrels per day in the third quarter, and 101.19 million barrels per day in the fourth quarter.
Consumption will come in at 101.56 million barrels per day in the first quarter of 2024, 101.77 million barrels per day in the second quarter of 2024, and 102.85 million barrels per day in both the third and fourth quarters of next year, according to the STEO, which showed that total demand was 99.36 million barrels per day in 2022.
“Global liquids fuel consumption in the forecast increases from an average of 99.4 million barrels per day in 2022 to 102.3 million barrels per day in 2024, driven primarily by growth in China and other non-OECD countries,” the February STEO noted.
“However, significant uncertainty around our demand forecast remains based on possible outcomes for the evolving global economic conditions and China’s pivot away from a zero-Covid strategy,” the STEO added.
“We forecast that the reversal of restrictions will contribute to oil demand in China increasing by 0.7 million barrels per day in 2023 and by 0.4 million barrels per day in 2024. We expect OECD oil demand to remain largely flat over the forecast period, as inflationary economic pressures continue to limit GDP and oil demand growth and as the oil intensity of OECD economies declines,” the STEO continued.
Investment Boom Nears as U.S. LNG Projects Race Toward FID
Jamison Conklin, Natural Gas Intelligence, February 10, 2023
Multiple U.S. LNG export projects could reach a final investment decision (FID) this year after a record stretch of supply contracting activity in 2022 that accelerated after war broke out in Ukraine.
Column: How lack of copper could slow the energy transition
Mining.Com, February 13, 2023
Avoiding a climate catastrophe is often portrayed as a question of political willpower. Yet the shift to net-zero carbon emissions is also a daunting technical challenge. For one thing, retooling power systems built around fossil fuels so they can run on renewable energy will require far more copper — the essential artery of power networks and electrical equipment — than the companies able to produce it are currently equipped to deliver. It’s far from clear whether a traditionally cautious mining industry will embrace the scale of investment needed to rewire the world. Failure would throw the energy transition off course.
Copper is an efficient electrical conductor that’s relatively abundant, and there’s no obvious substitute. You can find it in all kinds of products, from toasters to air conditioners and computer chips. There are about 65 pounds (30 kilograms) of copper in the average car and more than 400 pounds in the typical home. Decarbonizing power networks, transportation and industry will require far more of it than is currently available. Millions of feet of copper wiring are needed to build the denser, more complex grids that can handle electricity produced by decentralized renewable sources and balance out their intermittent supplies. Solar and wind farms require a lot more copper per unit of power produced than centralized coal and gas-fired power stations. Electric vehicles use more than twice as much copper as gasoline-powered cars, according to the Copper Alliance. As a result, annual demand is set to double to 50 million metric tons by 2035, according to an industry-funded study by S&P Global. That assumes enough of the red metal will become available, which is far from certain.
The Gas Stove Fiasco Is Not Over
Institute for Energy Research, February 10, 2023
The hubbub about banning indoor gas stoves that Biden’s Commissioner of the Consumer Product Safety Commission (CPSC) suggested last month and which was poo-pooed by the White House, saying President Biden did not support the ban, continues. Now, Biden’s Department of Energy is setting energy efficiency standards for consumer cooking appliances that would ban most indoor gas stoves. In its current form, the Energy Department admits its proposal would effectively take half of gas stove models off the market, unless modifications were performed. The reality may be worse because one estimate suggests that 95 percent of the market would not meet the proposed levels. Since the Department of Energy has greater authority than the CPSC, this is a more serious threat to the use of gas stoves and may represent a “backdoor approach” to American kitchens that the Biden Administration’s war on gas stoves may prefer.
In a notice of proposed rulemaking, the Department of Energy (DOE) said it has “tentatively concluded” that new energy conservation standards for stove appliances would be technologically feasible and economically justified. The agency proposed new limitations on how much energy electric stove tops (both coil and smooth) and gas cooking tops may consume in a year. According to the DOE, every major manufacturer has products that meet or exceed the proposed requirements. On the one hand, it proposes to end the prohibition on constant burning pilot lights in gas stoves, but, on the other hand, it says a stove with a constantly burning pilot light would not meet the new efficiency standards. The DOE rulemaking would also impose regulations on electric and gas ovens for the first time, providing that they may not utilize a linear power supply, or one that produces unregulated as well as regulated power.
According to DOE’s rulemaking, the standards could enable energy savings of 3.4 percent relative to a baseline without the standards–“the equivalent of the electricity use of 19 million residential homes in one year.” DOE also estimated that manufacturers would incur conversion costs of $183.4 million to comply with the standards. The new standard would raise the upfront cost of stove products by $32.5 million per year, but are estimated to save $100.8 million annually in operating costs. DOE estimates that the efficiency standards will pay for themselves in an average of 1.5 to five years. The average lifespan of a gas range is about 15 to 20 years. The proposed standards would go into effect in 2027 and cumulatively save up to $1.7 billion, according to DOE.
Gas stoves are used in about 35 percent of households nationwide, or about 40 million homes. The household figure is closer to 70 percent in some states, such as California and New Jersey. Other states where many residents use gas stoves include Nevada, Illinois and New York.
The agency is asking for public comment on the proposed rule. If enacted, the standards would apply to products manufactured or imported into the United States three years after the rule is finalized.