Annual Energy Outlook 2006 with Projections to 2030 - Usinfo.org

Industrial Sector Energy DemandEnergy Intensity Declines in MostIndustrial SubsectorsFigure 47. Projected energy intensity in 2030relative to 2004, by industry (percent of 2004 value)NonmanufacturingAgricultureMiningConstructionManufacturingEnergy-IntensiveFoodPaperBulk chemicalsGlassCementIron and steelAluminumPetroleum refineriesNon-energy-intensiveMetal-based durablesOther manufacturing0.0 0.5 1.0 1.5Within the industrial sector, the energy intensity ofdifferent industries (Figure 47) can change for a varietyof reasons. For example, there may be a change inthe types of activities or the methods used in a givensubsector, or more energy-efficient new capacity maybe installed to accommodate growth or replaceworn-out machinery.For each industry with a relatively rapid projectedchange in energy intensity from 2004 to 2030, there isa unique explanation. In the steel industry, most newcapacity is expected to use electric arc furnace technology,which has a lower energy intensity than theolder blast furnace/basic oxygen furnace technology.Thus, the average energy intensity for the iron andsteel industry declines by 21 percent overall from2004 to 2030. In the U.S. aluminum industry, no newprimary smelting capacity is expected to be constructed,and secondary smelting, a less energyintensiveprocess of melting scrap, is expected tobecome the dominant technology. As a result, theenergy intensity of the aluminum industry in 2030 isnearly one-third less than in 2004. In the metal-baseddurables industry, a robust growth projection, withoutput 114 percent greater in 2030 than in 2004,requires substantial amounts of new, more energyefficientcapital stock to meet demand for theindustry’s output. In the petroleum refining industry,coal consumption increases by 1.6 quadrillion Btufrom 2004 to 2030, as CTL production grows. Consequently,its energy intensity increases over time.Alternative Technology Cases ShowRange of Industrial Efficiency GainsFigure 48. Variation from reference case deliveredindustrial energy use in two alternative cases,2004-2030 (quadrillion Btu)3.02.01.00.0-1.0-2.0-3.02004 2010 2015 2020 2025 20302005 technologyReferenceHigh technologyThe technology cases for the industrial sector representalternative views of the evolution and adoptionof energy-reducing technologies. In some sectors,energy-reducing technologies make significant contributionsto lower energy intensity. For example,energy intensity in mining would increase if therewere more widespread adoption of technologies toproduce fuels from oil shale. In other subsectors, suchas glass, technologies or techniques that tend toimprove output quality have the ancillary effectof reducing energy consumption. Generally, themanufacturing sector has more potential than thenonmanufacturing sector for the adoption of energyreducingtechnologies.In the high technology case, increased biomassrecovery and additions of CHP capacity offset process-relatedreductions in on-site energy consumption.Industrial cogeneration capacity increases morerapidly in the high technology case (3.4 percent peryear) than in the reference case (3.1 percent per year)[86]. Still, total industrial delivered energy consumptionin 2030 is 2 quadrillion Btu less than in the referencecase for the same level of output, and industrialenergy intensity improves by 1.4 percent per year onaverage, compared with 1.2 percent in the referencecase (Figure 48).In the 2005 technology case, industrial deliveredenergy use in 2030 is 2.4 quadrillion Btu higher thanin the reference case. Although the energy efficiencyof new equipment remains at its 2005 level in thiscase, average efficiency improves as old equipment isretired, and aggregate industrial energy intensityimproves by 0.9 percent per year.Energy Information Administration / Annual Energy Outlook 2006 73