This week US President Obama vetoed the Keystone pipeline bill which the new Congress had passed as one of it highest priorities. Oil industry analysts believe the veto signals that the President will reject the project after the State Department study is completed. The pipeline, if approved, would run from Alberta, Canada to the southern US and carry crude oil from Canada’s oil sands.

Despite the rising energy potential of the US, it will not become the “next Saudi Arabia” according to the International Energy Agency. Fatih Birol, the executive director of the IEA, said traditional energy exporters in the Persian Gulf would continue to dominate global production in years to come. “The United States will never be a major oil exporter. Their import needs are getting less but the US is not becoming Saudi Arabia,” said Mr Birol. “Their production growth is good to diversify the market but it will not solve the world’s oil problems.” OPEC members, who include Saudi Arabia and Iraq, would remain well placed to meet global demand over the next decade. “Only the Middle East can fill the gap in oil production when new players, such as the US, Canada and Brazil see their production slow down,” added Mr Birol.

The 28 countries in the European Union have announced plans for a continent-wide single energy market to reduce its reliance on Russian natural gas and t0 cut a massive annual import bill of some 400 billion euros. The proposals by the European Commission come just as Russia once again is threatening to cut natural gas deliveries to Ukraine, putting supply to Europe at risk. This “fundamental transformation of Europe’s energy system” will require investment in resources and infrastructure of more than one trillion euros by 2020.

Currently Europe is heavily dependent on energy imports, with more than half of its energy needs supplied by production from abroad, including Russia, the Middle East and Norway. About 63% of Germany’s energy comes from foreign sources and this number rises to 77% for Italy.  France and the UK are among the least dependent on outside sources, needing just less than 50% of their energy needs from outside their respective countries.

Russia supplies about a third of all European Union natural gas needs, with half of that amount transiting Ukraine. Russia also remains the sole source of natural gas supply for many former Soviet republics in eastern Europe.

Nuclear power supplies the majority of electricity in Europe, at 29% of total power needs.  Renewable sources (hydro, wind, solar) supply about 25%.

The US city of Portland, Oregon is using water pipes to generate electricity.  The Lucid Energy project uses the gravity-fed flow of water inside a city pipeline to spin four 42” turbines that produce electricity for Portland General Electric customers under a 20-year power purchase agreement. The project is the first of its kind in the US. The project will generate approximately $2 million worth of renewable energy capacity over the 20-year period, enough electricity for more than 150 homes in Portland. The city will share in the revenue. After 20 years, the city will have the right to own the system and all the energy it produces.

 

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