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Climate Change Heats Gas-Coal Competition

September 14, 2009
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In California and elsewhere, the push toward carbon dioxide emission reductions means more battles between natural gas and coal over which should be the electric generation fuel to smooth increased reliance on more intermittent sources of renewable power such as wind and solar.

"You have to have natural gas to make any kind of cap-and-trade or carbon tax for climate change mitigation work," said David Maul, a Sacramento, CA-based energy consultant and former natural gas expert at the California Energy Commission (CEC). "The big issue in the United States, and even in the West, is natural gas versus coal. That is going to be a very raucous debate because of the politics of coal.

"The reality is that if the United States or the western U.S. wants to reduce its carbon footprint, it has to back off coal, and because of the intermittent nature of many of the renewables, every time you build new wind and solar, you need to have another equal amount of natural gas-fired generation capacity."

The latest draft plan from the Northwest Power and Conservation Council (NPCC) varies the role of natural gas with its different scenarios, but it makes clear that gas-fired generation is essential to "provide protection against rapid growth [in power demand] and offer reduced carbon-emission generation, if carbon prices are high."

More reliance on gas-fired generation as more renewable-based power is brought online carries "substantial" fuel price risk, but that is offset somewhat by what NPCC's plan calls moderate capital risk and relative short lead times on gas-fired power plants, along with lower carbon emissions than coal.

Because of the need to reduce carbon dioxide emissions, Maul said he sees a huge future for natural gas in North America, without even considering its transportation applications.

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