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What “Energy Independence” Really Means For The U.S.


Since the days of President Jimmy Carter and the 1970s oil crisis, the United States has relentlessly pursued the utopia of energy independence. Indeed, energy independence is a worthy pursuit that both Democrats and Republicans readily agree upon. After all, relying on other countries for oil, natural gas or coal is an inherently risky proposition since It can lead to wars, or compromise the country’s relationships with foreign powers.

The notion that the country could become self-sufficient by producing enough energy to sustain the entirety of its population and industries was first floated by Nixon when he declared war on foreign oil during the oil crisis of the 1970s.

It was later popularized by Bush in a state of the union address in February 2006 when he decried United States’ addiction to oil, which is often imported from unstable parts of the world before announcing plans to break this addiction by developing several alternatives, including a multibillion-dollar subsidized ramp-up of biofuels.

Bush went on to boldly declare that by 2025, America would “…make our dependence on Middle Eastern oil a thing of the past” by cutting imports from Gulf states by three-quarters.

Well, it turns out the former president was prescient on some key predictions, which in hindsight appears quite remarkable when you consider that back then, the shale industry was barely on its feet.

The revelation that the U.S. is currently producing more energy than it consumes suggests that America has finally achieved the seemingly elusive goal of producing enough fuels to avoid relying on the rest of the world.

Net Energy Exporter

According to the U.S. Energy Information Administration (EIA), the United States was a net energy exporter in 2019 and 2020.

EIA notes that total U.S. annual primary energy net imports (imports minus exports) generally increased in most years since the mid-1950s, reaching a record high in 2005, equal to about 30% of total U.S. energy consumption. Since 2005, total annual energy imports have gradually decreased while total energy exports have increased.

The United States became a net total energy exporter in 2019 for the first time since 1952, and maintained that position in 2020 even though both total energy production and consumption were lower in 2020 than in 2019. Total U.S. energy exports exceeded total energy imports by 3.46 quadrillion British thermal units (quads) in 2020, the largest margin on record. U.S. energy exports in 2020 totaled 23.47 quads, and energy imports fell 13% to 20.0 quads, the lowest level since 1992.

Crude oil accounts for the largest share of U.S. energy imports on an energy content basis. Even though the United States remained a net importer of crude oil in 2020, crude oil net imports were at the lowest level since 1985. Moreover, some of the imported crude oil is refined into products that are exported.


Source: EIA

Despite a 4% drop in domestic crude oil production in 2020 from 2019, U.S. crude oil net imports in 2020 were the lowest since 1985. U.S. total annual crude oil exports have increased every year since 2010 and reached a record high in 2020 of about 3.18 million barrels per day (b/d). U.S. crude oil imports fell to about 5.88 million b/d in 2020.

U.S. petroleum products (excluding crude oil) imports and exports declined in 2020 from 2019: imports by 15% and exports by 5%. However, total annual petroleum products exports in 2020 were the third highest on record behind 2019 and 2018. Propane was the most-exported petroleum product in 2020, followed by distillate fuel oil.

Gross exports of natural gas have increased every year since 2014, and in 2017, the United States became a net exporter of natural gas for the first time since the late 1950s. In 2020, natural gas gross exports reached a record high of 14.43 billion cubic feet per day (Bcf/d), and gross imports of natural gas fell to 6.99 Bcf/d, the lowest level since 1993. Increases in domestic natural gas production and increases in liquefied natural gas (LNG) export capacity have contributed to growth in natural gas exports.

Trade volumes of coal and other fuels account for relatively small shares of U.S. total energy trade. U.S. coal exports, which had increased in both 2017 and 2018, decreased in both 2019 and 2020. The United States has been a net coal exporter since at least 1949.

Net Petroleum Exporter

In 2019, for the first ever, the U.S. became a net exporter of petroleum–which includes crude oil and petroleum products.

Unfortunately, U.S. crude imports have remained stubbornly high even during the shale boom thanks to healthy domestic demand. U.S. crude oil production has shot up 160% to over 13 million b/d since the advent of the shale era; meanwhile, domestic demand has remained flat but very high at 19-21 million b/d.

In 2019, the country still imported 9.1 million b/d of petroleum and other liquids, with 6.8 million b/d of those being crude oil, due to constraints such as regional supply/demand imbalances, infrastructural challenges, and other factors. Further, many of the refineries in the United States are optimized to process the heavier crude grades from Canada, Venezuela, and Mexico instead of the lighter, sweeter oil crude from its own shale fields.


Source: EIA

The big consolation here is that a bigger proportion of its oil imports have been coming from its northern ally, with crude imports from Canada clocking in at 134 million barrels in 2019 from 76 million in 2008.

As Bush predicted, the United States is no longer as heavily reliant on OPEC for its oil, with the organization supplying less than 30% of imports.

Renewables Offer The Best Solution

It’s, therefore, clear that whereas the overall trend is that the U.S. has been exporting more energy than it imports, it’s still a very mixed bag with many regions still importing vast quantities of crude and other petroleum products.

To complicate matters further, the planet’s fossil fuel reserves are finite, with experts estimating that the U.S. only has enough natural gas reserves to last 93 more years, and enough coal to last about 283 years.

In other words, the United States will never achieve true energy independence while still relying so heavily on fossil fuels.

Indeed, some experts now contend that the only one surefire way to be completely and indefinitely energy independent is by adopting 100% renewable energy.

At first, this sounds like a pipe-dream, considering that only tiny Costa Rica has come close to achieving that goal after it generated 98.1% of its electricity from renewables in 2016. The Central American nation, however, has a population of 5 million vs. 330 million by the U.S. and a land area 0.5% the size of the U.S.

But some experts still insist that 100% renewable energy in the U.S. is not only feasible but can lower costs.

Renewable resources generate only around 19 percent of U.S. electricity in 2020. However, last year, a group of researchers at Stanford University set out to prove that a 100% renewable energy grid by 2050 is not only feasible but can be done without any blackouts and at a lower cost than the existing grid.

The researchers matched time-dependent energy supply with demand and storage in a grid integration model for every 30 second interval in 2050 and 2051. The study authors analyzed U.S. regions and countrywide demand until the model produced a solution with what the authors called zero-load loss–meaning, essentially, no blackouts with 100% renewable energy and storage.

Wesley Cole, a senior energy analyst at the National Renewable Energy Laboratory (NREL), says that hourly interval models are more common, but this new study gives researchers like himself a boost of confidence that they are not missing anything by modeling at a higher temporal resolution.

“The question is much more an economic question, not so much a technical question,” says Cole. According to Cole, the pathway to a 100% renewable grid is not as expensive as first estimated due to huge cost reductions in solar and wind energy over the years.

Unfortunately, politics always seem to get in the way.

By Alex Kimani for

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