Here we are in the middle of September 2012 and I was hoping for some downward moving in gasoline prices. Your West Valley News of Sun City, AZ reported on Friday, September 14, 2012, that local gas prices have reached their highest levels in three months according to a staff reporter. [Ref 1] Folks living in the West Valley of Maricopa County, Arizona are paying $3.71 per gallon as reported by AAA Arizona the day before. This is an average rise of 2 cents for the west valley in the last week. In the past month, the cost of a gallon of gasoline has increased nearly 35 cents state-wide.
As we know from previous posts, a variety of factors influence the price of retail gasoline. Continued sluggish economic news, including slow U.S. job growth, is providing downward pressure on prices, while tight supplies and the Fed injecting money into the economy have applied upward pressure. AAA officials said another factor keeping prices up is the cost of crude oil, entering its sixth consecutive week at more than $90 a barrel. “Many motorists were anticipating that September would bring an end to this six-week price surge,” said Linda Gorman, director of communications and public affairs for AAA Arizona. [Ref 1] “However, due to current market factors and volatility, Arizonans are going to have to wait a little bit longer for relief to arrive.” Linda, I am one of those motorists!
Add to that the recent impacts of Hurricane Isaac which caused several oil companies to shut-down refineries in the Gulf coast for a week or more to protect workers and equipment (see, August 28, 2012 post – Hurricane Isaac and Spiking Gas Prices). The Hurricane has come and gone, and much of the clean-up of debris from the storm has been removed. Yet, still lingering are these high gas prices. A new developing incident that has added instability to the higher cost of crude oil is the recent unrest in Libya that led to the attack of the U.S. embassy and sadly the death of four Americans including Ambassador Chris Stevens on Tuesday, September 11, 2012 in the City of Benghazi. Tragic and unfortunate, yet a classic example of how international incidents can drive up the cost of a barrel of crude oil.
My July 31, 2012 post explored the sources of energy that we use in the U.S. This post identifies how much energy we use from each source.
Primary Energy Use by Source
We know from earlier posts that the primary energy sources in the U.S. are petroleum, natural gas, coal, nuclear fuel, and renewables. As we also discussed, electricity is a secondary energy source that is generated from these primary forms of energy.
According to the Department of Energy, total U.S. energy use in 2011 was about 97.5 quadrillion (=1015, or one thousand trillion) Btu. One quadrillion Btu, often referred to as a “quad,” therefore represents about 1% of total U.S. energy use. [Ref 2]
In physical energy terms, 1 quad represents:
– 2 million barrels of oil (about 10 days of U.S. oil use)
– 50 million tons of coal (enough to generate about 3% of annual U.S. electricity use),
– about 1 trillion cubic feet of natural gas (equal to 4% of annual U.S. natural gas use in 2011).
The number of quads used in 2011 from each primary energy source is shown in the pie chart above. Petroleum (oil) provides the largest share of U.S. primary energy at 36% followed by natural gas (25%). These two sources combined make up 61% of the energy we consume each day.
Primary Energy Use by Sector
The primary energy sources discussed above are used in residential and commercial buildings (including homes, businesses, schools, and churches), in transportation, and by industry. Primary energy is also used to generate electricity. The bar chart on the left shows the amount of primary energy used in each of these sectors. As you can see, electric power generation is the largest user of primary energy, followed by transportation.
The electric power sector uses primary energy to generate electricity, which makes electricity a secondary, rather than a primary, energy source. Nearly all electricity is then used in buildings and by industry. This means that the total levels of energy used by residential and commercial buildings, industry, and transportation are actually higher than the amounts shown on the graphics when electricity is added in.
As shown, the generation of electricity and transportation are responsible for 2/3 or 66.5% of the energy consumed in the U.S. These data provide good reference information when we look at opportunities to reduce energy consumption across resources and sectors.
- Local gas prices reach highest level in 3 months, Staff Report, Your West Valley News, September 14, 2012, http://www.yourwestvalley.com/suncitywest/article_c9c15d2c-fe8b-11e1-b374-001a4bcf887a.html
- “What are the major sources and users of energy in the United States? “, U.S. Energy Information Administration,http://www.eia.gov/energy_in_brief/major_energy_sources_and_users.cfm