Catalyst Spring 2015

[FINAL ANALYSIS]

Doubling Down on Natural Gas Is Not the Answer

By Jeff Deyette

As the U.S. electricity system retires more and more aging and polluting coal-fired generators, natural gas has become the primary fuel of choice for many power producers. Florida, for instance, the third-largest electricity producer in the United States, now generates 62 percent of its electricity from natural gas—up from 44 percent just a few years ago. All told, 16 states generated more than one-third of their electricity from natural gas in 2013. This growth in gas-fired electricity is driving near-term reductions in air pollution and global warming emissions, and providing an economic boost to some regions of the country.

However, as good as these near-term benefits might sound, the latest UCS analysis reveals that this growing reliance on natural gas carries with it complex risks that should not be ignored. For example, even though natural gas supplies have grown markedly, prices continue to be volatile. Price spikes not only harm consumers and the economy, but can also create perverse incentives for utilities to switch back to using old and polluting coal plants. And while natural gas plants’ smokestack emissions are significantly cleaner than those of coal plants, the extraction, distribution, and combustion of natural gas result in the leakage of methane, which presents serious environmental, public health, and climate change challenges. (Methane is 34 times stronger than carbon dioxide at trapping heat in the atmosphere.)

Instead of doubling down on natural gas to replace coal and meet our growing electricity demand, we should prioritize investments in renewable energy and energy efficiency. UCS analysis shows that this strategy would result in numerous benefits including natural gas prices that are 2 percent lower by 2040—a boon for both the electricity sector and other domestic and industrial consumers of natural gas. Even by 2020, we found the net societal benefits from the emissions reductions under this scenario add up to $36 billion. By 2040, the annual benefits grow to nearly $170 billion.

The choice is clear. As the nation moves away from coal, setting course toward a diverse supply of low-carbon power sources (composed primarily of renewable energy and energy efficiency with a balanced role for natural gas) is far preferable to a wholesale switch to natural gas. By making smart energy choices today, we can transition to a more consumer-friendly and resilient electricity system, achieve cost-effective reductions in global warming emissions, and face fewer risks from an overreliance on natural gas.

Jeff Deyette is assistant director of energy research and analysis in the UCS Climate and Energy Program. Read more from Jeff on our blog, The Equation.