City & State Pennsylvania Magazine
(by Jim Chen)
Published in January of this year, the U.S. Energy Information Administration (“EIA”) Short-Term Energy Outlook (‘STEO’) forecast shows a rising trend in energy production across all sectors. These trends include not only an increase in oil and gas production, but also a rise in alternative energy generation such as wind and solar, supported by battery storage technology that increases by 14 gigawatts this year and 9 gigawatts next year for a total installed capacity of 40 gigawatts by 2025. Overall, these trends are a net positive for the United States as the country diversifies energy sources in the United States and the means by which electricity is generated. Diversification of our energy supply matters – not simply from a supply side calculus, but for reasons of national security, technology leadership, economic prosperity and growth, and the environment. An “all-of-the-above” strategy is simply smart policy for the United States.
From an economic perspective, reliance on a single source of energy leaves the country vulnerable to price shocks and shortages when inevitable issues arise. Petroleum should be a particular focus as the United States is the largest consumer of oil in the world at over 20 million barrels per day. Of that amount, 66.6% is consumed in the transportation sector, 43% for motor gasoline alone. As a result, diversification can be beneficial and reduce risk in the transportation sector as part of the overall energy mix.
The national security and economic implications of an overreliance on a single source of energy are significant, regardless of the U.S. rate of domestic production. For example, oil is a global commodity subject to volatile price fluctuations based on world events. …