While the United States' long-time marriage with fossil fuels is nowhere near over, a federal report published Wednesday forecasts that the country's affair with renewable energy is heating up.
According to the U.S. Department of Energy's annual outlook, the department expects renewable-energy consumption, excluding hydroelectric power, to nearly double from 3.4 quadrillion Btu in 2006 to 6.7 quadrillion Btu in 2030.
That's a boost from the 5.5 quadrillion Btu the department forecast by 2030 last year. But it still leaves renewables as a relatively small portion of the world's energy.
According to the DOE, petroleum, coal and natural gas still will meet 83 percent of the United States' energy needs by 2030. The figure is down a smidgen from the 85-percent dependency share seen in 2006.
The outlook also projects that the nation's ethanol consumption will grow from 5.6 billion gallons in 2006 to 13.5 billion gallons in 2012 -- easily surpassing the U.S goal of using 7.5 billion gallons of biofuel by 2012 -- and to 17 billion gallons by 2030, with the bulk of the biofuel being blended with gasoline for transportation.
Those numbers could change if the energy bill approved by the House last week passes in the Senate and avoids a presidential veto (see House Passes Energy Bill and Senate Sends Energy Bill Back to Beginning). The bill calls for the use of 36 billion gallons of biofuels by 2022, with 21 billion of those gallons coming from nonfood sources.
But despite policy support for biofuels, building ethanol plants and making them profitable has proven to be difficult so far. Companies have been juggling rising corn prices and falling ethanol prices, and a number have postponed or canceled plants (see Another Ethanol Plant Gets Cancelled, Ethanol's Tough Times Continue, Ethanol Margins Suffer and Biofuel Forecast Buoys a Bit).
And, even though the energy department's outlook bodes well for renewables, a number of analysts -- including Tom Murley, head of the U.S. private-equity group HgCapital -- recommend caution.
According to Financial News Online US on Wednesday, Murley warned that clean-energy stocks could be about to fall.
While he said long-term prospects are bright for high-quality clean-energy companies, Murley compared soaring stock prices to the technology bull market of the late 1990s and warned that overexcitement leads to disappointment when profits fail to meet investor expectations, according to the report.