Recent natural gas boom holds lessons for other low carbon energy? I think not.
Alexis Madrigal over at the Atlantic made a post recently called “The Huge Shift in Our Energy System That’s Happening Right Now in 1 Chart”, with the above EIA chart as its centerpiece. The main premise is that coal has always produced the largest portion of the U.S.’s electricity, but that is about to change as electricity production from natural gas has grown steadily over the past decade, and particularly fast in the past few years due to a rapid rise in shale gas production. As a result, U.S. emissions have fallen significantly since natural gas has roughly half the carbon footprint of coal (when solely considering combustion). There is much speculation over whether the low natural gas prices which have enabled this change will stick around or eventually increase.
Other analysts in the climate world are very excited about this turn of events. Roger Pielke Jr. of UC Boulder and the Breakthrough Institute just published a piece called “Climate of Failure” over at Foreign Policy. The piece mimics his book “The Climate Fix” and explains just how hard it is to decrease emissions in a world obsessed with GDP growth. But, towards the end of the piece, he offers some reasons for hope in low carbon energy:
America’s recent boom in the production of shale gas illustrates the virtuousness of innovation: In the United States, shale gas has become widely available and inexpensive due to technologies developed by the government and private sector over decades and has displaced large amounts of coal in a remarkably short time, dramatically reducing carbon dioxide emissions in the process… Natural gas is not a long-term solution to the challenge of stabilizing carbon dioxide levels in the atmosphere, because it is still carbon intensive, but the rapidly declining U.S. emissions prove an essential policy point: Make clean(er) energy cheap, and dirty energy will be quickly displaced.
This last statement, especially the addition of the (er), irks me. By throwing in the (er), he is lumping natural gas into the same category as other clean, low-carbon energy technologies like wind and solar. Wind and solar are functionally very different from natural gas generation; they cannot be deployed on demand like natural gas can. As long as there is fuel supply, natural gas power stations can be ramped up and down rather quickly to match electricity demand. Wind and solar fuel availability is, while decently predicted now through weather forecasting software (see, for instance, recent Colorado day with 57% wind power), not “on demand” without large amounts of expensive electricity storage. It cannot be dispatched.
Additionally, Pielke offers no analysis of just why dirty energy was so quickly displaced in recent years with “cleaner” energy. Madrigal’s article points out that between 2000-2012, natural gas electricity capacity grew by nearly 100%, which is exactly what enabled this displacement. At first, many natural gas plants were built to run as “peaking” units, to be ramped up and down quickly to meet short periods of demand, like hot summer days when everyone has their air conditioner on full blast when they get home at 5pm. As natural gas became cheaper, however, the operating hours of these plants increased, while the operating hours of coal plants decreased. Dial one up, dial one down.
The redundancy of capacity in our grid between coal and natural gas is exactly why coal generation declined and natural gas generation increased so rapidly. Currently, wind and solar do not have the liberty of this redundancy, and don’t even come close. So even as we make solar and wind energy cheaper (whether through innovation or deployment), it will not “quickly displace” dirty energy in the way natural gas has done with coal, simply because it is not dispatchable and there is no redundancy.
And in the interim, cheap natural gas prices are hurting deployment of wind and solar, as Tom Friedman noted in his Sunday op-ed. He offers a carbon price as the tool to effectively combat coal, and put natural gas and wind/solar on more equal footing, potentially such that might eventually together displace base-load coal power. Pielke thinks such carbon price tools are “mythical”, unfortunately, even as he puts blind faith in innovation based on shale gas’s success. This capacity redundancy point deserves more scrutiny. It is a huge pillar that led to the shale gas success in terms of available demand for the resource, yet most analysts are simply pointing to technological innovation spurred on by government R&D investment and public-private partnerships as the main driving forces for success.