Looking ahead to the year 2030, the Energy Information Administration forecasts that oil, coal, and natural gas will comprise 80% of the US energy supply. That is about the same percentage that fossil fuels provide today.
However, the EIA also predicts rapid growth for biofuels and other renewables due to rising demand, high oil prices, and increasing public pressure for companies to invest in alternative energy forms. So volumes will increase even though percentages are expected to remain roughly the same.
KPMG - the audit, tax, and advisory firm - recently published the results of a survey of 553 petroleum financial executives on the subject of renewable energy. Surprisingly, most of those polled say they believe renewable energy sources are key to the issue of declining oil reserves.
Sixty percent believe the trend of declining reserves is irreversible, according to the survey. Another 60% say that mass production of renewable fuel is not a near-term possibility, although they agree it should be part of the mix.
“These executives are deeply concerned about declining oil reserves, a situation they see as irreversible and worsening,” says Bill Kimble, KPMG’s national line of business leader, industrial markets. “They see renewable energy sources as a lifeline, but our survey shows that the execs recognize they cannot count on them as a solution in the short term. Consequently, oil and gas companies are sending a clear signal to the government that intervention is needed.”
The KPMG survey shows that 25% of respondents said that at least 75% of government funding into energy should be directed at the renewable sources sector, and a further 44% said that at least 50% of funding should be allocated in this manner. In all, 82% cited declining oil reserves as a concern.
Of the 40% of executives who believe renewable energy can become a mass-produced reality by 2010, 18% say ethanol is the most viable for mass production, followed by 13% who say biodiesel, and only 3% who say cellulosic ethanol.
Companies such as ConocoPhillips, Chevron, Marathon, Shell, Total, and London-based BP are spending billions of dollars on wind, solar, biodiesel, ethanol, and hydrogen power projects. Among the majors, only ExxonMobil has declined to invest directly in renewable energy development, saying the sector lacks profitability without government subsidies. However, the Irving, Tex.-based energy giant has given $100 million to Stanford University to help develop technologies to reduce greenhouse gases.
Speaking of greenhouse gases, 65% of those in the KPMG survey say they believe global warming is occurring, while 11% say it is not. Less than 25% believe carbon dioxide is causing global warming; most believe it is a natural weather cycle.
