Senator Cautions Against Too Much Gas Reliance
Some Capitol Hill lawmakers and energy experts believe the
United States may be setting itself for another energy crisis 10 to
20 years down the road by relying to heavily on natural gas to fuel
new power generation facilities.
"I believe that [heavy dependence on gas] is a path that's
pretty dangerous for America...," warned Sen. Pete Domenici (R-NM)
during an Senate oversight hearing into U.S. gas demand and supply
"I think.....some other sources of energy for electricity have
to enter into this mix or we will find ourselves at some point with
the demand being so high for natural gas that it, too, will reach a
very high market value, and then we'll be wondering why we weren't
more concerned," he told his colleagues on the Senate Energy and
Natural Resources Committee.
"I think one of the most interesting questions before our
country is what is going to happen now in the next 20 years with
reference to electricity because as of now the only power plants we
are adding to our national grid come from natural gas.....There's
no nuclear power, and there's no other alternative. And coal is
even no long being used for new power plants. To the natural gas
enthusiast, that sounds great." But to Domenici, following a
single-fuel path is risky.
William Martin, chairman of the Washington Policy and Analysis
Group, echoed this sentiment. He believes there's just "too much
good news for natural gas" now. Although he acknowledged that
natural gas is going to be the fuel of choice for the "next many,
many decades," Martin believes there's a need to "balance" out the
fuel sources for electricity.
The Energy Information Administration (EIA) estimates that about
780 new generation plants (average size of 300 MWs) will be built
over the next 20 years, of which 92% will be fueled by natural gas,
said EIA Administrator Jay Hakes. He noted that "pure
restructuring" of the electricity industry has motivated companies
to lean towards gas-fired generation facilities, which he said have
lower capital and operating costs.
However, Hakes said the EIA sees coal becoming more competitive
with natural gas as a generation source in the out years --- around
2020. "We believe that the coal industry will continue to be able
to reduce the costs of coal whereas this heavy demand for gas is
going to force exploration into more difficult areas, so the price
differential between coal and gas will be wider than it is today,"
he told the Senate panel. Gas still will have an edge then, Hakes
said, but coal will be more competitive.
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