There’s no such thing as a natural gas fairy who can turn the nation’s coal-fired power plants into cleaner gas-burners, the U.S. Government Accountability Office (GAO) said last week in a report to Congress.

With carbon dioxide (CO2) emissions on its mind, a House committee last summer asked GAO to talk to the U.S. Department of Energy about the costs and consequences of shifting the nation’s coal plants to gas. As lawmakers ponder ways to reduce emissions of greenhouse gases (GHG), such as CO2, whatever methods they employ are expected to raise the cost of coal-fired generation and increase demand for gas-fired power generators.

A large-scale conversion of the existing coal-fired fleet is a nonstarter, GAO said.

“[T]he ability of these units to switch is limited by high natural gas prices, supply constraints and existing infrastructure,” GAO said. “In addition, increasing the nation’s use of natural gas for electricity generation could result in adverse economic consequences. Natural gas currently costs about four times more than coal per British thermal unit and has shown a relatively higher rate of price increases and volatility over time relative to coal, according to EIA [the Energy Information Administration].”

Additionally, GAO said it would be more effective to build new gas-fired plants than to convert existing coal plants to gas use due to technical and economic factors.

“Because of these technical and other issues, large-scale shifting [of] demand for electricity production from coal to natural gas would increase electricity prices, residential and commercial heating costs, and fuel costs for certain industries that consume large quantities of natural gas, including chemical and fertilizer manufacturers,” GAO said. “Because of these and other concerns, key stakeholders said that switching coal plants to natural gas has occurred infrequently in the past and is not likely to occur in the future.”

A recent study commissioned by the American Gas Foundation found that it would be better to burn more natural gas for residential and commercial uses than for power generation (see Daily GPI, May 2). Lawmakers are debating the Lieberman-Warner bill, introduced last year by Sens. Joseph Lieberman (I-CT) and John Warner (R-VA). If enacted, it would cut GHG emissions but could also drive up the price of natural gas, according to research by the EIA (see Daily GPI, May 1).

The full GAO report and a summary are available on the GAO website, www.gao.gov, under the “Reports & Testimonials” tab.

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