Natural gas looks like a winner in new carbon planJun 3 - Jennifer A. Dlouhy Houston Chronicle
Natural gas is poised to be one of the biggest winners of the Obama administration's new plan to slash carbon dioxide emissions, accelerating the electric sector's move away from coal toward the cleaner-burning power source. Despite a modest climb in coal use for electric generation in 2013, it already has fallen out of favor in the power generation, as utilities turn to natural gas for its cheaper, lower-emission profile. The Environmental Protection Agency's proposed standards -- requiring states to pare carbon dioxide emissions 30 percent over 2005 levels by 2030 -- are likely to hasten that switch. Industry leaders talked up the agency's decision to give states broad flexibility to meet the proposed mandates, an approach that ensures continued coal-to-gas switching is one of the options. Marty Durbin, president of America's Natural Gas Alliance, a group of producers looking to build demand for the fossil fuel, said gas is "already providing significant economic and environmental benefits," and that flexible rules can preserve that dynamic. "The rules should be flexible and fair," Durbin said. States would have wide latitude deciding how to meet the EPA's proposed carbon dioxide emission cuts, with options including greater efficiency along transmission lines and among electric consumers as well as adopting more renewable power sources, such as wind and solar. While boosting efficiency may be the cheapest, quickest option in the short run, some states and utilities will seek to retire older coal-fired plants or add gas to existing facilities. Power plants using natural gas generate about half as much carbon dioxide as coal-fired generation, on average. Just increasing the use of existing U.S. power plants that run on natural gas could help move states toward their individual goals, said Derek Furstenwerth, senior director of Environmental Services for Calpine Corp., a Houston-based power company. Natural-gas production in the U.S. has surged as energy companies combine hydraulic fracturing and horizontal drilling to unlock dense underground rock formations. Any increased power sector demand for natural gas could keep that activity going, said Marvin Odum, president of Shell Oil Co. "While we are still evaluating the proposed rule, it's clear the increased use of natural gas in the existing power sector could create the opportunity for the U.S. to further capitalize on abundant North American natural gas supplies," Odum said in a statement. But not everyone is convinced. Ross Eisenberg, vice president of energy and resources policy at the National Association of Manufacturers, which opposes the proposed carbon rule, said that natural gas' gains could be short lived. "There's opportunity for gas in the short term," he said. "But in the long term, any major reductions here will hurt coal and natural gas." http://www.energycentral.com/functional/news/news_detail.cfm?did=32672984&
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