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Moeller, State Regulators: Natural Gas Needed to Support Renewables

January 18, 2010
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Given the push for renewable energy to address climate change, natural gas increasingly will play a key role in energy policy in the years ahead, according to FERC Commissioner Philip Moeller and three state regulators from the Pacific Northwest.

All spoke last week at Law Seminars International's "Buying and Selling Electric Power in the West" in Seattle. Gas for power generation continues to become more critical as intermittent wind and solar generation resources are added to the nation's power supply, Moeller said.

Moeller cited a statistic that showed the portion of natural gas used for electric generation nationally increased by 1.5% last year. His optimism for gas, Moeller said, is driven by its "easy" integration with wind and other renewables,;the fact that there will only be limited new nuclear generation developed; and because coal has "clearly lost favor" with policymakers and the public.

Officials from the states of Montana, Oregon and Washington, speaking as a panel looking at the regional impact of climate change initiatives, echoed the FERC commissioner's thoughts in response to questions about gas' future.

"Certainly natural gas is going to play a role in electric generation," said Michael Grainey, a lawyer and renewable energy adviser to Oregon's business development department and former head of the state's energy department. "It is going to play an increasingly bigger role in terms of volume as Commissioner Moeller mentioned, but the type of role it plays is open to question. It will be increasingly important for peaking and shaping and enabling more renewable energy."

Historically, gas has played a similar role regarding the Pacific Northwest hydroelectric system, Grainey said. "We think of the hydro system as a stable baseload, but the fact is that in a critical water year [of extreme shortfalls] there can be a 5,000 MW swing, a huge difference from one year to the next," he said.

As a former board member on the Northwest Energy Coalition in the 1980s, Montana Public Service Commission member Ken Toole remembers promoting natural gas as the "bridge to the future," and he emphasized that is still the case today, and even more so with the advent of climate and renewable issues. "We can't get to where we are and to where we need to be based on the resources we have, and natural gas could assist in moving toward a different kind of energy future or resource base," Toole said.

While agreeing with Grainey that the "highest and most efficient use" of natural gas is in direct use in heating, Toole said the reality is that without dedicating more volumes of gas to meeting power generation needs, states and that nation cannot get to where policymakers want to be regarding addressing climate change. At the same time, Toole said he is optimistic that electric storage technologies will be developed that will address the intermittency of wind and solar, aside from gas's role.

"I think the worst thing we could do would be to use natural gas for baseload electric generation without a plan or an understanding that ultimately we are trying to get somewhere else, and these are just temporary steps to get to that bigger renewable future."

Jeffrey Goltz, chairman of the Washington Utilities and Transportation Commission, said he, too, is familiar with gas being dubbed the bridge fuel, but he thinks the "bridge" continually keeps getting longer. "I still think it is going to be a fairly long bridge from this point in time," Goltz said.

He thinks one of two scenarios have to develop regarding gas in relation to renewables: advanced electric storage technologies need to get developed so wind and solar become more like baseload resources; or other renewable resources are developed to provide the backup, such as geothermal or wave power. "If you don't get storage or other resources, this [gas] bridge just keeps on going," Goltz said. "Otherwise, I don't know how you undo that.

"Finally, because this bridge is longer than we anticipated it would be, we do have to make some pretty major decisions on transmission and how much longer natural gas will be needed as a shaping fuel to generate electricity. There will be some major transmission issues related to that as well, but the bridge is definitely longer than anybody thought."

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