EIA (Energey Information Administration) has projected carbon dioxide (CO2) emissions from fossil fuels in the US in 2009 to be 5.9 per cent below the 2008 level in its latest analysis. Coal accounts for 63 per cent of the total decline in CO2 emissions from fossil fuels this year. The decline in industrial, commercial and residential energy consumption of coal and natural gas, the substitution of natural gas for coal in the electric power sector, and the increase in non-CO2-emitting generation combine to reduce CO2 emissions in 2009 by an estimated 242 million metric tons, or 70 percent of the projected decline in total US. CO2 emissions from all fossil fuel use.
Forecast lower natural gas and petroleum emissions this year make up 7 per cent and 30 per cent of the projected total decline in CO2 emissions from fossil fuels, respectively.
A decline in coal, natural gas, and electricity consumption in the industrial sector, a result of the weak economy, accounts for 140 million metric tons, or about 40 per cent, of the total projected reduction in CO2 emissions. Industrial activity, including manufacturing, is disproportionately impacted by the economic downturn, with the index of manufacturing activity forecast to decline by 11.5 per cent in 2009, considerably more than the 2.5 per cent forecast decline in real gross domestic product (GDP).
Forecast coal, natural gas, and electricity consumption in the commercial and residential sectors is also lower this year because of the weak economy, a slightly warmer winter, and milder summer. We expect CO2 emissions from the commercial and residential sectors to be 29 million metric tons lower in 2009, or just over 8 per cent of the total projected reduction in CO2 emissions this year.
Projected reductions in CO2 emissions associated with changes in the electricity generation mix reflect both increases in emission-free generation from hydropower, wind, and nuclear power and, with substantially lower natural gas prices, decisions by some electricity suppliers to back out some coal generation in favor of natural gas generation.
Low industrial demand for natural gas is among the factors contributing to lower natural gas prices, so part of the change in the electricity generation mix, which accounts for 73 million metric tons, or about 20 per cent, of the total projected decline in CO2 emissions, is indirectly related to the decline in industrial activity.
The decline in CO2 emissions from petroleum consumption, which occurs primarily in economy-related reductions in jet fuel and distillate fuel consumption, accounts for the other 30 per cent of the forecast reduction in CO2 emissions.
A key factor in the expected 5.9 per cent decline in CO2 emissions from fossil fuels in 2009 is the decline in economic activity. Although real GDP is forecast to fall by 2.5 per cent in 2009, industrial sector production, which includes manufacturing and is energy-intensive, is projected to fall at a much faster rate. For example, the 2009 average manufacturing production index is expected to fall by 11.5 per cent while raw steel production declines by 40 per cent.
