EIA Energy Outlook 2020 – A closer look
- Aug 29, 2020 4:11 pm GMT
It’s a rainy, dank day in New England this Saturday, and golf is not on the agenda. So, this is a great opportunity to contemplate the EIA’s 2020 Energy Outlook published in August and consider its main points, and to look for any missing items from their analysis, that could be factors impacting our energy future. Let’s start with the key issues the report considered:
- Pandemic control measures, especially lockdowns; their duration; and their potential to extend the employment and demand impacts of the current situation
- Pace and level of economic recovery, both domestic and globally
- Effects of governmental stimulus and corporate-sector wage support on investment patterns
- Sector- and activity-specific demand changes across the entire energy system
- Potential persistence of people’s behavioral changes, along with acceleration or deceleration of trends in employment, travel, trade, and consumption of goods and services
- Market pricing, from short-run shocks and disruptions through medium-term equilibration and long-term implications
- Changes to the U.S. energy import/export balance, including petroleum, other liquids, natural gas, electric power, and coal trade
- Impacts on the developing global and U.S. liquefied natural gas (LNG) markets
- Production responses, capital investment, and production trends for upstream oil and natural gas firms
- Changing refinery product demands and responses
- Electric power system operations, shifts in timing and levels of demand, and impacts on markets and rates
- Electric power generation decisions, including unit additions and retirements
- Environmental implications for system inputs, outputs, and regulatory requirements
Which got me wondering if there are additional factors that could affect our energy future that might be worth considering:
- Election outcome; How will a new president effect the energy outlook. How would retaining the current Administration effect energy outlook.
- How will the House and Senate outcomes effect energy outlook; no doubt item 3 above could be impacted
- Will the budget deficit have any impact on our ability to recover from the COVID economic trough
- Will civil unrest continue and what will the government do in response? Will this unrest and resulting response have an impact
- Natural disasters, such as the 1-2 hurricane punch seen in the Gulf of Mexico, and the ability to recover from these disasters.
- Upheaval to the education system resulting from COVID effects with many students in “remote learning mode” and many colleges experiencing severe submission reductions, resulting in layoffs, driving down electricity demand
- What if we are experiencing the “new normal” with high unemployment rates, and reduction in economic activity persists
- How will tensions over State/Federal regulatory authority be settled; will wholesale markets survive
- What actions will our Energy leadership (industry, government, regulatory, politicians) take to address all of this uncertainty. Will these actions, or lack of action help or hurt
- Is the situation in California really just a glimpse of what we’re all going to face; rolling blackouts, energy shortages and more violent natural disasters. California and Australia have suffered from severe fires and portions of the Northeastern US are in a severe drought. Powerful weather conditions are causing immense damage; I never heard of a derecho until this year, but, I know I never want to experience one after seeing the damage it can do
- Are we focusing our energies on the things we can do now to improve our chances for a brighter future; the COVID vaccine is certainly one of the positive initiatives, but should we be doing more and if so, what are those things we can do now. An athlete practices in preparation for their big events, what are the “preparatory” things we should be doing now to lay the groundwork for a successful recovery and brighter future
- Are the election outcomes the key deciding factor for what happens next? If so, are we stuck in place until 2021?
- If we are stuck in place for 2020, how bad can it get before real forward progress will be possible?
I’m sure there are more factors to consider, but to be candid – this is already a pretty daunting slate of items and any further additions may not offer any guidance on a path forward. There is already plenty in this list to stimulate thought on where we are, or could be, heading.
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