# Presentation: 255774

## American Statistical Association (ASA) Committee on Energy Statistics

**Guy F. Caruso, Administrator**
**Energy Information Administration (EIA****)**
- Washington, DC
- April 6, 2006

## Since the Last Meeting ...

**EIA’s Outlook for 2006**** **
**Eliminating MTBE (Methyl Tertiary-Butyl Ether) from Gasoline**
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**EIA Considers Challenges in Expanding EIA-914 Data to Include Crude Oil Production**
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**EIA’s Newest Internet Data Collection Systems**
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**Revised Guidelines on Voluntary Reporting of Greenhouse Gases**
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**EIA’s Website Improvements**
**EIA’s Current Budget Activity**
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**DOE's Five Year Plan for FY 2007-2011 **
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**External Review Team**
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**EIA’s 30****th**** Anniversary Celebration!**

## EIA Outlook 2006EIA Reassessed Its Long-term Oil Price Projection

- The AEO2006 reference case includes much higher world oil prices than previous AEOs
- Key change in EIA’s expectations about oil prices
- EIA has reexamined the willingness of oil-rich countries to expand production capacity
- Cost of doing business increasing

**Notes:**
A key change in EIA’s long term outlook, the AEO2006, was made in our expectations about oil prices.  While I don’t intend to go into the details, I wanted to address  this important change.
EIA does not try to “predict” long-term oil prices; rather it considers a number of alternative oil price scenarios and examines their implications.  The world oil market is simply too complex for anyone to consistently and accurately predict future long-term oil prices. 
However, EIA reassessed its long-term oil price outlook for the AEO2006 reference case.  Our expectations on the upstream investment climate have changed for several reasons.
EIA has reexamined the willingness of oil-rich countries to expand production capacity as aggressively as had been envisioned previously.  Historically, oil producers have worried that high world oil prices would reduce economic activity as evidenced by the recessions accompanying previous price hikes.  Recently, high world oil prices do not appear to have significantly impacted world economic growth.
Investment impediments are perceived to be more persistent, even after several years of relatively high crude oil prices.

## World Oil Price*, 1980-2030

**World Oil Price*, 1980-2030**
**(2004 dollars per barrel)**

- *World oil price is the weighted average price of imported low sulfur light crude oil.

**Notes:**
The AEO2006 reference case includes much higher world oil prices than previous AEOs.  In AEO2006, world crude oil prices, which are now expressed in terms of the average price of imported low-sulfur crude oil to U.S. refiners, are projected to fall from current levels to about $47 per barrel in (2004 dollars) in 2014, then rise to $54 per barrel in 2025 and $57 per barrel in 2030. The projected price in 2025 is about $21 per barrel higher than projected in last year’s reference case. 
In previous AEOs, the world crude oil price was defined on the basis of the average imported refiner acquisition cost of crude oil or IRAC.  Historically, IRAC price has tended to be a few dollars less then the premium crudes, such as West Texas Intermediate and Brent.  In an effort to provide a crude oil price that is more consistent with those generally reported in the media, AEO2006 uses the average price of imported low-sulfur crude oil to U.S. refiners, which is closer to WTI.
It should be noted that the reference case is only one of many scenarios considered.  Energy market projections are subject to considerable uncertainty. Price projections are particularly uncertain, because small shifts in either supply or demand, which are both relatively insensitive to price changes, can necessitate large price movements to restore balance between supply and demand.

## Eliminating MTBE from Gasoline

- Petroleum Companies announced intent  to remove Methyl Tertiary-Butyl Ether (MTBE) from gasoline in 2006
- Driven by State bans due to water contamination concerns
- Industry intends to transition before 2006 summer driving season
- Could cause short-term impact on motor gasoline supply/price
- This impacts EIA data collection and modeling

## EIA-914 Expansion of Data

- Monthly survey of natural gas production may be expanded to include crude oil production
- There will be a presentation by John Wood highlighting the challenges

## EIA’s Newest Internet Data Collection Systems (IDCs)

- Launched several new IDCs
- EIA-6A, Coal Distribution Report (Annual)
- EIA-63A, Annual Solar Thermal Collector Manufacturers Survey
- EIA-63B, Annual Photovoltaic Module/Cell Manufacturers Survey
- EIA-858, Uranium Marketing Annual Survey
- There will be a session on the development of a Functional Requirements Document for the next IDC System

**Notes:**
Stan Freedman, who serves as Chair of the development team, will report on our current effort to develop a Functional Requirements Document for future systems

## Voluntary Reporting of Greenhouse Gases Program Revised Guidelines

- Responds To 2002 Presidential Directive
- Reduce U.S. Greenhouse Gas Intensity By 18% By 2012
- Improve Accuracy, Reliability & Verifiability Of Submitted Data
- In Excess of 200 Companies Currently Report
- “Registered” Reductions Encourage:
- Entity-wide Reporting
- High Quality Emissions Inventory
- Revisions
- Cause Major Redesign Of Program
- Become Effective June 1, 2006
- Fully Implemented During 2007

## Website Improvements

- EIA’s new site became live in November
- Kid’s Page currently being evaluated through customer survey
- Popular page on website (300,000 users in February 2006)
- Goal is to improve content and navigation

**Notes:**
The National Energy Information Center (NEIC) has a new office director, Gina Pearson, who is also our new Web Champion.
We appreciate the committee’s help by participating in the usability testing during the Spring 2005 meeting.

## Current Budget Activity

- EIA’s FY 2006 Budget
- EIA received an $85.3M appropriation
- Increase of $1.5M from FY 2005
- Funds 370 FTEs
- EIA’s FY 2007 Budget Request
- EIA requested $89.8M
- Increase of $4.5M from FY 2006
- Funds 375 FTEs

## DOE’s Five Year  Plan  for FY 2007-2011

- Plan highlights specific long-term goals to measure progress
- Timeliness of EIA Products: 90 percent meet release date targets.
- Quality of EIA Products: 90 percent or more of customers are satisfied.
- Efficiency Measure: Actual survey costs will be less than baseline adjusted for inflation.
- EIA looking at strengthening recruitment strategies
- May need committee’s help with ideas, candidates, etc.

## External Review Team

- Team members are:
- Kathy Cooper
- Denny Ellerman (Chair)
- Jay Hakes
- Paul Joskow
- Phil Sharp
- Met in July and November, 2005
- Expected to report this spring

**Notes:**
Affiliations of Team Members

Kathy Cooper:  
Former Undersecretary of the Office of Economic Affairs at U.S. Dept of Commerce
Recently named Dean of the College of Business Administration at the University of North Texas

Danny Ellerman (Team Chair)
Senior Lecturer, Sloan School of Management, Massachusetts Institute of Technology
In June 2005, Denny stepped down after 13 years as Executive Director of MIT's Center for Energy and Environmental Policy Research.
Prior to coming to MIT, Denny spent 18 years with the US Government (primarily the Department of Energy and its predecessors)

Jay Hakes
  Former EIA Administrator
  Currently Director of the Jimmy Carter Library

Paul Joskow
Professor of Economics and Management at MIT
Director of the MIT Center for Energy and Environmental Policy Research

Phil Sharp
Former Congressman
Formerly a Lecturer in Public Policy at the Kennedy School of Government at Harvard University 
Named New President of Resources for the Future 

## EIA’s 30th Anniversary Celebration!

- In 2007 EIA will celebrate its 30th Anniversary
- There will be a series of educational programs throughout the year
- We’d like to have ideas/input from the committee
- We welcome committee participation as speakers at these events

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