Monday, July 19, 2010

Asking the Wrong Questions with Natural Gas

MIT recently released an interim report on the continuing role of natural gas in society appropriately titled ‘The Future of Natural Gas’.1 Sadly with regards to the most meaningful question surrounding natural gas, the 104-page report loses its way by page 13. The prime mover influencing the growth of natural gas in the future is what long-term climate policy the United States pursues. With regards to climate policy the MIT report explores 3 different scenarios: a business-as-usual case with no significant carbon constraints; GHG emissions pricing through a cap-and-trade system or emissions tax leading to a 50% reduction in U.S. emissions below the 2005 level by 2050; GHG reduction via U.S. regulatory measures without emissions pricing: a renewable portfolio.1

On its face these scenarios seem appropriate, until one recalls that if the United States is only able to reduce emissions by 50% of 2005 levels by 2050 the development of dangerous and severely detrimental consequences due to human-driven climate change are all but guaranteed. The point of any climate policy should be to achieve an emissions goal, which will significantly reduce the probability of these dangerous and detrimental consequences otherwise what is the point of any change in the current climate policy at all. Sure a reduction of 50% may buy society a decade or two, but realistically it is highly unlikely that the extra decade will really matter in the end result. Therefore, while all three scenarios reviewed may have been viewed as politically viable (and they probably are), none of them accomplish the paramount goal of a new climate policy, thus the analysis inherently misses the most critical question regarding the role of natural gas in the future, which significantly reduces the usefulness of the analysis.

The most critical question regarding the future use of natural gas involves an aspect of its role as a substitute for coal in electricity production. While most individuals ‘in the know’ believe that natural gas will be used as a ‘bridge’ to a lower-carbon energy environment they do not address how long that bridge needs to be or even if it is appropriate in the first place. If the United States is going to take its role as a world leader in environmental issues seriously then an 80% reduction of 2005 emission levels by 2050 is the minimum requirement. To achieve such a result almost all to all (depending on the how the low-carbon transportation sector evolves) electricity will have to be produced through trace carbon means (geothermal, solar, wind, biomass, hydroelectric, nuclear, etc.). However, if this is the case, then the critical question is: will the monetary investment and resultant environmental damage that stems from acquiring unconventional sources of natural gas (as it is highly probable that there are not enough conventional gas reserves to provide the necessary electricity in the future) be better used to form a ‘bridge’ of natural gas which will start to collapse by 2035-40 or should this investment be applied to the more rapid deployment of these cleaner alternatives skipping natural gas entirely? If this question is not the first issue when discussing future energy policy, what is the point of having the discussion?

The MIT report also questions whether or not natural gas would be incorporated into the automobile fleet as a means to reduce emissions from the transportation sector. The development and rapid deployment of a natural gas fueled vehicle seems rather misguided unless electrical vehicles fall flat. For instance powering an electric vehicle with natural gas as the source of the electricity is more efficient, more economical and produces fewer emissions than using natural gas as a direct fuel for transportation. Overall it is unfortunate that this new MIT report misses the most critical issue when moving forward in the discussion regarding what sources will provide electricity in the future under the aim of emission reduction to reduce the probability of negative outcomes from human-driven global warming.

For more information regarding the background of how energy policy and electricity use must change to achieve the necessary emission reductions go to this link:

1. Moniz, Ernest, Jacoby, Henry, Meggs, Anthony, et, Al. “The Future of Natural Gas: An Interdisciplinary MIT Study.” MIT Energy Initiative. 2010. ICBM: 978-0-9828008-0-5

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