Originally posted on Forbes.
2014 included headlines of stalled infrastructure projects, concerns over plummeting oil prices, and tough partisan battles over the future of renewables and greenhouse gas emission targets.
Yet despite these hurdles, bright spots can be seen on the horizon in the global energy market for 2015, due to the innovation, creation, and transformation by leaders in the field.
1. Keystone XL Pipeline
KXL is undoubtedly the most scrutinized infrastructure project in the history of the United States. The proposed pipeline to expand already existing connections of Canadian oil sands with U.S. refineries. Indeed, President Obama approved the southern half of Keystone XL amid much fanfare prior to the last presidential election. Keystone, and KXL South are in full operation, transporting approximately 850,000 barrels per day of Canadian crude to Midwestern and Gulf refineries.
The remaining portion of KXL would expand the pipeline by an additional 450,000 barrels of oil to market. One-quarter of that amount is however dedicated to relieve bottlenecks of U.S. crude oil from the U.S. Bakken region currently being transported by rail.
Despite the significant safety and environmental need for new energy infrastructure, the six year project remains mired in political shenanigans.
2. Proposed EPA Regulations
In June, the Environmental Protection Agency (EPA) announced regulations to cut carbon emissions by 30% by 2030. This substantial reduction will require significant reductions from each state, but weighs most heavily on coal-powered states to reduce emissions from coal power plants. Industry groups and energy companies alike are waiting apprehensively for the final ruling mid-2015 to determine the future of coal in theU.S.
Republicans have vowed to modify the regulations, and Mr. Obama seems equally intent on cementing his environmental legacy.
3. Falling Oil Prices
Since June, oil prices have tumbled to a seven year low, currently indexed around $55.00 per barrel. A static world economy and the United States’ re-emergence as the world’s leading producer of oil and gas have combined to create a glut which is expected to last well into 2015.
While consumers celebrate, economists and policy officials are closely watching events. Should the price of oil fall too low, U.S. producers may find themselves out of business, and unable to compete with OPEC, which for the moment, may be able to outlast the competition.
4. Oil Train Regulations
Safety transporting energy produced in North America requires extensive regulation by the Pipeline and Hazardous Materials Safety Administration (PHMSA), the federal agency tasked with Hazmat transportation. Afterseveral train accidents in 2014, public and political pressure forced PHMSA’s parent agency, the United States Department of Transportation to aggressively move forward with regulations aimed at eliminating older crude oil carrying train cars.
Recent regulations proposed by PHMSA will have major implications for producers and shippers if confirmed; the whole industry anxiously awaits a final ruling in 2015.
5. Renewable Energy Storage
Recent advances in energy storage provide support to those hoping the transition to a more renewables-rich energy mix is just around the corner. The temporary storage of electricity has been one of the great challenges and promises for the power sector.
The potential ability to temporarily store electricity at low cost would eliminate many of the thorny problems associated with the intermittency of renewables.
Real advances are being made in storage, but current business and regulatory models have thus far, failed to support further evolution. Storage is the game changer for the power sector and the technology that needs the most dedicated attention and external support to make meaningful gains in the next year and over the coming decade.