Friday, August 17, 2012

Cheaper Natural Gas Contributing To Lower Emissions

Carbon dioxide levels as measured by the EPA have reached a 20 year low across the United States. The decline is due in large part to the fact that utilities across the country have shifted away from coal to cheaper natural gas. Burning natural gas releases less carbon dioxide than coal does at the smokestack, so the fact that coal use has reached lows not seen since World War II is playing a major role in the decline.
While New Jersey has barred new coal-fired plants from being built, the state’s leading electric producer still operates two major coal plants in Jersey City and Mercer County, among the biggest emitters of carbon dioxide in the state.

Most air pollution from the two Public Service Enterprise Group coal plants has plummeted in recent years following almost $1 billion in technology upgrades. But the plants still produced 4.1 million metric tons of carbon dioxide in 2010, according to a U.S. Environmental Protection Agency database. Still, it was PSEG’s natural gas plant in Ridgefield that emitted the most greenhouse gases into the air from New Jersey with 2.6 million metric tons.

Governor Christie’s Energy Master Plan, released last year, bars new coal-burning plants from being built while calling for the state’s natural gas infrastructure to be expanded. So far it has.

A Tennessee Gas pipeline through the Highlands that carries methane mined from Pennsylvania through the controversial technique called hydraulic fracturing, or fracking, was expanded last year despite protests from residents and environmentalists. Construction on a second pipeline expansion project through West Milford, Ringwood and Mahwah is scheduled to begin soon and will quadruple capacity.

In a little-noticed technical report, the U.S. Energy Information Agency, a part of the Energy Department, said this month that total U.S. CO2 emissions for the first four months of this year fell to about 1992 levels. The Associated Press contacted environmental experts, scientists and utility companies and learned that virtually everyone believes the shift could have major long-term implications for U.S. energy policy.

While conservation efforts, the lagging economy and greater use of renewable energy are factors in the CO2 decline, the drop-off is due mainly to low-priced natural gas, the agency said.

A frenzy of shale gas drilling in the Northeast’s Marcellus Shale and in Texas, Arkansas and Louisiana has caused the wholesale price of natural gas to plummet from $7 or $8 per unit to about $3 over the past four years, making it cheaper to burn than coal for a given amount of energy produced. As a result, utilities are relying more than ever on gas-fired generating plants.

Both government and industry experts said the biggest surprise is how quickly the electric industry turned away from coal. In 2005, coal was used to produce about half of all the electricity generated in the U.S. The Energy Information Agency said that fell to 34 percent in March, the lowest level since it began keeping records nearly 40 years ago.

The question is whether the shift is just one bright spot in a big, gloomy picture, or a potentially larger trend.

Coal and energy use are still growing rapidly in other countries, particularly China, and CO2 levels globally are rising, not falling. Moreover, changes in the marketplace — a boom in the economy, a fall in coal prices, a rise in natural gas — could stall or even reverse the shift. For example, U.S. emissions fell in 2008 and 2009, then rose in 2010 before falling again last year.

Also, while natural gas burns cleaner than coal, it still emits some CO2. And drilling has its own environmental consequences, which are not yet fully understood.

“Natural gas is not a long-term solution to the CO2 problem,” Pielke warned.

The International Energy Agency said the U.S. has cut carbon dioxide emissions more than any other country over the last six years. Total U.S. carbon emissions from energy consumption peaked at about 6 billion metric tons in 2007. Projections for this year are around 5.2 billion, and the 1990 figure was about 5 billion.

China’s emissions were estimated to be about 9 billion tons in 2011, accounting for about 29 percent of the global total. The U.S. accounted for approximately 16 percent. Mann called it “ironic” that the shift from coal to gas has helped bring the U.S. closer to meeting some of the greenhouse gas targets in the 1997 Kyoto treaty on global warming, which the United States never ratified. On the other hand, leaks of methane from natural gas wells could be pushing the U.S. over the Kyoto target for that gas.

Even with such questions, ­public health experts welcome |the shift, since it is reducing air pollution.

“The trend is good. We like it. We are pleased that we’re shifting away from one of the dirtiest sources to one that’s much cleaner,” said Janice Nolen, an American Lung Association spokeswoman. “It’s been a real surprise to see this kind of shift. We certainly didn’t predict it.”

Power plants that burn coal produce more than 90 times as much sulfur dioxide, five times as much nitrogen oxide and twice as much carbon dioxide as those that run on natural gas, according to the Government Accountability Office, the investigative arm of Congress. Sulfur dioxide causes acid rain and nitrogen oxide leads to smog.
That decline is brought about by multi-year lows in the cost of natural gas as compared to coal production. It's far cheaper to burn natural gas than coal to produce the same amount of energy, which is why utilities are switching over to natural gas.

It's supply and demand - economics 101.

The coal industry is facing major problems as a result of the swift departure from coal use to natural gas. They're trying to figure out how to market and reposition coal productions so as to try and save coal industry jobs, but many of those jobs will not return unless costs for natural gas rise to the point that it becomes cost effective for coal to be mined/extracted.

Natural gas industry workers are benefiting from the coal industry woes - and regions that are rich in natural gas are seeing a renaissance. That includes locations along major oil shale deposits such as the Bakken and Marcellus fields. It's brought about windfalls to communities where natural gas is being exploited - the opposite of what is being experienced where coal mines are being closed because it isn't cost-effective to operate at current coal prices.

Environmental regulations are only tangentially affecting the job situation - it's the price of natural gas that is driving the swift turnover to natural gas for energy production.


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