# Presentation: 461046

## Developing Key Energy Indicators

- Meeting of the ASA Committee on Energy Statistics
- Thursday, October 18, 2007
- Janice Lent, SMG
- Joseph Conklin, OOG
- This is a working document prepared by the Energy Information Administration (EIA) in order to solicit advice and comment on statistical matters from the American Statistical Association Committee on Energy Statistics. This topic will be discussed at EIA's fall 2007 meeting with the Committee to be held October 18 and 19, 2007.

## Motivation for the Key Energy Indicators Project

- Make the “big picture” of the U.S. energy situation easily accessible.
- Highlight important *changes* in the U.S. energy situation.
- Provide faster access to some of EIA’s most broadly relevant products.
- Answer the simple questions up front.

## Outline

- Background
- The growing popularity of indicator collections
- Indicator collections presented by statistical agencies
- Parameters of the Key Energy Indicators project
- Issues in selecting Key Energy Indicators
- Preliminary Indicator List (Joe Conklin)

## Popularity of Indicator Sets

- NAS is developing a “State of the USA” website.
- International organizations maintain indicator sets, for example,
- United Nations Statistics Division,
- Organization for Economic Cooperation and Development,
- International Atomic Energy Association,
- European Union.
- Some Energy Indicator collections are available, e.g., from the International Energy Agency

## Indicator Collections from Federal Statistical Agencies

- Bureau of Labor Statistics
- Key indicators related to prices, employment, and earnings
- Simple display of change in indicator values
- Bureau of the Census
- Key economic indicators related to manufacturing, business volumes, sales, and profits
- Drop-down menu display on home page
- Bureau of Transportation Statistics
- Indices of transportation services and airfares
- Graphical displays on home page

## Comparing Indicator Lists from Federal Statistical Agencies

- Similarities
- Current data, highest level of aggregation, with drill-down capabilities
- All indicators are products of the publishing agency
- All indicators relate to economics
- Differences
- Displays vary: numerical, verbal, graphical
- Size of indicator collections vary (8, 14, 2)

## Parameters of the Key Energy Indicators Project

- Key Energy Indicators Subgroup (KEIS) was chartered by the Interoffice Issues Group (IIG).
- Target audience for the indicators:
- Policy makers
- Media
- Interested public
- Indicator characteristics
- Current
- Data based
- Broadly focused

## EIA Offices Participating in the Key Energy Indicators Project

- Office of Oil and Gas (OOG)
- Office of Coal, Nuclear energy, Electricity, and Alternative Fuels (CNEAF)
- Office of Energy Marketing and End Use (EMEU)
- Statistics and Methods Group (SMG)
- National Energy Information Center (NEIC)
- Office of Integrated Analysis and Forecasting (OIAF)

## Issues Related to Energy Indicators

- Inclusion of wholesale energy market prices (not EIA products)
- Inclusion of EIA Principle Economic Indicators
- Frequency, aggregation levels, drill-down capabilities
- Should all indicators be EIA products?
- Usability testing and metadata

## Wholesale Energy Market Prices

- Examples:
- West Texas Intermediate (WTI) Cushing spot crude oil price
- Henry Hub natural gas spot price
- Very important indicators of the direction of energy prices
- Disadvantages:
- Can change from minute to minute
- Customers usually get them from trade web sites
- Significance is not obvious to the interested public

## Principle Economic Indicators (PEI’s)

- OMB designates some indicators as PEI’s.
- PEI’s must be released according to fixed schedules and are subject to pre-release embargo rules.
- BLS and BOC indicator lists correspond closely to PEI’s.
- EIA currently has one indicator with PEI designation.
- All future EIA PEI’s will be seriously considered for inclusion in the Key Energy Indicators set.

## Other Issues

- Frequency, aggregation levels, drill-down
- Electricity generation—monthly or annual?
- Gasoline prices—average price or change in average price?
- Should all indicators be EIA products?
- Usability testing and metadata
- Presentation
- Documentation
- Standard errors

## Categories of Preliminary Key Energy Indicators

- Consumer energy price indicators
- Producer energy price indicators
- Supply/Consumption/Fuel mix indicators
- Energy/Carbon intensity of the U.S. economy

## Consumer Energy Price Indicators

- Average retail price of regular gasoline (weekly)
- Residential price of electricity by region (monthly, annual)
- Residential price of natural gas (monthly, annual)
- Energy Consumer Price Index (to be developed)

## Producer Energy Price Indicators

- Average price of on-highway diesel fuel (weekly)
- Wholesale crude oil price (daily)

## Supply/Consumption/Fuel Mix Indicators

- U.S. energy (BTU’s) production by fuel type
- U.S. energy (BTU’s) consumption by fuel type
- Electricity generation by fuel source (monthly, annual)
- Net petroleum supply by source country (monthly)
- Volume of natural gas in underground storage (weekly)

## Energy/Carbon Intensity of the U.S. Economy

- Energy intensity of the economy (BTU’s/GDP)
- Carbon intensity of the economy (CO2/GDP)

## Average Retail Prices for Regular Gasoline and On-highway Diesel

- Background
- EIA collects weekly gas price data.
- Average gas prices appear on the EIA home page.
- Reasons for selecting these indicators
- Gasoline is a major consumer energy expenditure.
- Price of diesel fuel impacts consumers indirectly.

## Residential Price of Electricity

- Background
- Data collected on forms EIA-861 and EIA-826
- Published monthly and annually
- Prices differ by region
- Reasons for selecting this indicator
- Major consumer energy expenditure
- Easily understood

## Residential Price of Natural Gas

- Background
- Published monthly and annually by EIA
- Drill-down capabilities to other heating fuel prices
- Reasons for selecting this indicator
- Most widely-used household heating fuel
- Major consumer energy expenditure
- Easily understood

## Energy Consumer Price Index (ECPI)

- Background
- BLS energy CPI has limitations
- Small sample
- Outdated weights
- EIA ECPI would require more research
- Reasons for selecting this indicator
- Track overall change in consumer energy prices
- EIA ECPI would be superior to the BLS index

## Wholesale Crude Oil Price

- Background
- EIA publishes a daily WTI settlement price
- Data are obtained from Bloomberg
- Only indicator that is *not* an EIA product
- Reasons for selecting this indicator
- About 40% of America’s energy is derived from crude oil
- Easily understood, in spite of indirect impact

## Energy Production and Consumption (BTU’s) by Fuel Type

- Background
- Total production and consumption published in MER and AER.
- Aggregate estimates hard to find on the website.
- Reasons for selecting these indicators
- Answer “How much energy do we make/use?”
- Fuel mix will eventually change.
- Ratio of production to consumption may change.

## Electricity Generation by Fuel Source

- Background
- Published monthly and annually
- Data to be collected on form EIA-923
- Reasons for selecting this indicator
- Mix of fuels used impacts prices, emissions, energy dependence
- Many are unaware of the current fuel mix.

## Net Petroleum Supply by Source Country

- Background
- EIA publishes estimates monthly
- Data collected on form EIA-814
- Reasons for selecting this indicator
- About 60% of petroleum Americans use is imported.
- Mix of countries impacts energy prices and supply security.

## Natural Gas in Underground Storage

- Background
- EIA collects data through Form EIA-912
- Estimates are released every Thursday at 10:30 a.m.
- Reasons for selecting this indicator
- EIA’s weekly release is closely followed by energy traders and forecasters.
- OMB recently designated this indicator as a PEI.

## Energy Intensity of the Economy

- Background
- Defined as energy consumption (BTU’s) divided by GDP
- Published annually by EIA
- Reasons for selecting this indicator
- Reductions indicate genuine energy efficiency gains
- Appears on the EU’s Short List

## Carbon Intensity of the Economy

- Background
- Defined as carbon dioxide emissions divided by GDP
- Published annually by EIA
- Reasons for selecting this indicator
- Reductions indicate genuine improvements in environmental friendliness.
- National reduction goals have been established.

## Questions for the Committee

- Are the types of indicators selected appropriate?
- Are particular indicators missing from our list?
- Should the most recent number always be published “up front”?
- What error measures should be published with the indicators?