US Electricity
Figure 1: Delivered Energy Consumption Figure 2: Electricity Generation by Fuel
by Sector, (quadrillion BTUs) 1980-2030 (billion kilowatt hours)
Source: EIA, 2009 Source: EIA, 2009
IntheAEO2009referencecase,near-termeconomicvolatility GHG Emission Concerns Impacting Public Policy
is assumed to stabilise. Four consecutive quarters of negative The new US administration dramatically increases the
annualised economic growth are anticipated during the likelihood of policies and regulations limiting US greenhouse
forecast’sfirsttwoyearswithrecoverybeginningbyorin2010. gas (GHG) emissions, even though a considerable amount of
Longer-term, the AEO2009 suggests that real GDP grows at uncertainty in the science behind the policies exists. When
an average of 2.5% per year from 2007 to 2030 with the asked about the level of confidence in the science underlying
nation’s population, labour force and productivity growing at potential GHG policies, Black & Veatch survey respondents’
annual rates of 0.9%, 0.7%, and 1.9% respectively. opinions were divided with the majority either falling in the
Figure 1 illustrates how the above assumptions impact neutraltolessconfidentsideofthescale(Figure3).Incontrast,
energy use by sector. Figure 2 shows electricity generation by industry opinion also seems to be in favour of the notion that
fuel, taking existing legislation that is currently in favour of manisthecauseofclimatechangeeventhoughsurveyresults
renewable generation and demand side efficiencies into would indicate thatthe science isnothighly trusted (Figure 4).
account. Lastly, energy price increases caused by potential Irrespective of the misalignment between confidence in the
carbon reduction legislation could place pressure on GDP science and popular opinion, public policies are being formed
growth and change the relative allocations of fuel mix for that take GHG emissions into account for fossil fuels used in
electricity generation. transportation, manufacturing and energy production. In the
US, many public utility commissions require that
Figure 3: Climate Change: How Solidly Do You Believe
integrated resource plans for energy utilities include
The Science Behind Current Public Opinion?
assumed CO
2
allowance fees for fossil fuelled
generation, along with demand side management
and energy efficiency programs that reduce energy
consumption.
On the transactions side, major financial
institutions, in consultation with electricity market
participants, announced the formation of climate
change guidelines for advisors and lenders to power
companies in the US (The Carbon Principles).
The Principles Are:
Energy Efficiency: An effective way to limit CO
2
emissions is to not produce them. The signatory
financialinstitutionswillencourageclientstoinvest
in cost effective demand reduction, taking into
Source: Black & Veatch Strategic Directions Survey
consideration the value of avoided CO
2
emissions.
30 worldPower2009
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