Ken Silverstein | Aug 06, 2012

U.S. carbon dioxide emissions are falling. Why? New data by a governmental branch is saying that the switch from coal to unconventional forms of natural gas is the main reason, followed by an unusually warm 2012 winter.

Coal-fired power, in fact, used to provide about half of the electric generation market, and it is now 34 percent. At the same time, natural gas from shale is rising, providing almost as much fuel for utilities as coal -- but certainly trending higher. The result is fewer carbon dioxide emissions, notably less than in previous years, says the U.S. Energy Information Administration.

“Amid historically low natural gas prices and the warmest March ever recorded in much of the United States, coal's share of total net generation dropped to 34 percent — the lowest level since at least January 1973,” says the agency. “Despite seasonally low loads, natural gas-fired generation grew markedly and accounted for 30 percent of overall net generation by March 2012. Total electricity demand fell this winter as warmer weather reduced home heating requirements.”

The research goes on to say that modern combined-cycle natural gas generation results in the more efficient production of electricity. That has contributed to fewer heat-trapping emissions, along with the fact that natural gas has fewer pollutants tied to it than does coal. The report also says that about 90 percent of the carbon dioxide emissions associated with energy production is from burning coal.

Altogether, the Energy Information Administration is reporting that carbon dioxide emissions are 2.4 percent less in 2011 than they were in 2010. They are also 9.1 percent less than in 2007.

True, years of economic lag have meant that commercial and industrial enterprises are demanding less energy. But now those financial prospects and numbers are starting to tick up. The decline in carbon is therefore tied more to fuel switching than anything else. It’s also associated with higher oil prices, causing people to drive less -- something that may also lead to more alternatively-fueled vehicles. 

The implications: Production from shale formations has grown from a negligible amount just a few years ago to almost 15 percent of total U.S. natural gas production. By 2035, natural gas, generally, will make up about 45 percent of the utility generation market, says the Energy Information Administration.

With the new abundance and lower prices, lower-carbon gas seems likely to play a much larger role in the generation of electric power,” writes Daniel Yergin, in his book “The Quest.”

Global Emissions

Certainly, green energy has its place. But if environmentalists are concerned about rising greenhouse gas emissions, why not welcome shale gas development and promote better and safer hydraulic fracturing? That’s the controversial method by which producers ply loose the shale gas from the rocks where it is embedded -- blamed by some for polluting drinking water supplies.

Some green groups do see natural gas as a bridge to the future that will rely on renewable energy. Others, however, say that supply levels are finite and that the atmosphere cannot absorb many more greenhouse gas emissions, urging instead a faster shift to sustainable energies. 

To that end, the global community’s carbon dioxide emissions are rising -- up about 48 percent since 1992, says the International Energy Agency in Paris. It adds that such releases are 6.7 percent greater than 2010.

But does this not underscore the need for burning fuels that produce less toxins than coal? Global proven reserves of shale gas are estimated to be at 6,600 trillion cubic feet, according to the U.S. Energy Information Administration.

China and the United States have the most supplies at 1,275 and 862 trillion cubic feet, respectively. The other countries sitting atop huge swaths of shale gas are Argentina, Mexico, South Africa and Australia. And while France has such potential, the regulatory environment there is unfriendly to developers.

“There is no one magic bullet. There is no one technology you need, because the world is different in different places ... You’ve got to do a real cradle to grave analysis,” says Deputy Executive Director Richard H. Jones, in a story on the international agency’s web site.

Carbon dioxide emissions are declining in this country. That is mostly a function of using a lot more natural gas, which happens to be relatively cheap and clean when compared to the alternatives. If the world community can come to terms with how shale gas is produced and then share the best-available technologies, global heat trapping emissions may also eventually start falling.  


EnergyBiz Insider has been awarded the Gold for Original Web Commentary presented by the American Society of Business Press Editors. The column is also the Winner of the 2011 Online Column category awarded by Media Industry News, MIN. Ken Silverstein has been named one of the Top Economics Journalists by Wall Street Economists.

Twitter: @Ken_Silverstein

energybizinsider@energycentral.com

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