Natural gas is on top ... for now
natural gas” from shale formations, said Frank Wolak, professor of economics and an energy expert at Stanford University. “There is no doubt that if that innovation had not occurred, we would be burning even more coal.”
A ripple effect
Even major oil companies are focusing more on natural gas. For example, of the 16 new projects BP plans to complete by 2021, 12 of them involve natural gas instead of oil.
Diesel is also feeling the impact. Increasingly, city governments are switching their fleets of metropolitan vehicles, such as buses, from diesel to natural gas and electricity.
Low natural gas prices have delivered a body blow to nuclear power, eating into revenue. An analysis by Bloomberg New Energy Finance found more than half of U.S. reactors are losing money.
California’s last nuclear reactor in operation, Diablo Canyon, is slated to begin closing its doors in 2024.
It appears nuclear’s losses equal gains for natural gas.
When the San Onofre Nuclear Generating Station closed permanently after a January 2012 leak, natural gas as a percentage of California’s in-state generation ballooned from 45.4 percent in 2011 to 61.1 percent in 2012, according to figures from the California Energy Commission.
Role of renewables
Falling prices for renewable energy sources, such as solar and wind, plus aggressive mandates from state policymakers have propelled California to the forefront of integrating renewables into the state’s power mix.
In the California energy commission’s most recent figures, the share of in-state generation from renewables reached 27.9 percent in 2016 — nearly twice as much as in 2009.
At the same time, growth in wind and solar is often linked to growth in natural gas.
That’s because wind and solar have problems with intermittency: Solar production slips when the sun doesn’t shine and electricity generated by wind wanes when breezes don’t blow. Supplies of natural gas smooth out the gaps.
Mark Zoback, director of the Natural Gas Initiative at Stanford University, said the relationship between renewables and natural gas is not an either/or proposition.
“If the sun is really shining, which is mostly in the afternoon, or the wind is really blowing, which is mostly at night, you can cycle the natural gas plants to compensate for what the renewables are or are not doing,” he said.
Zoback said the long-term future of energy will belong to renewable sources, but they’re not there yet and abundant supplies of natural gas will help foster the transition.
The opposition
Environmental groups are uniformly opposed to natural gas.
Although cleaner than coal, natural gas is nonetheless a fossil fuel that emits greenhouse gases. Natural gas is mostly made up of methane, and there are concerns about leaks because methane, if released into the atmosphere, is about 30 times more potent than CO2.
“When you take into account the environmental impacts and the dangers of climate change associated with natural gas, it might be natural, but it’s not good for the environment,” said Dan Jacobson, state director at Environment California.
The development of energy storage systems powered by batteries may also pose a challenge to natural gas.
Right now, gas “peaker” plants are fired up to meet energy demands, such as when large numbers of utility customers turn on their air conditioners during heat waves.
But supporters of battery storage see a day when peaker plants will be replaced — by storing up energy when, say, wind and solar are producing at their maximum amounts and then deploying that energy when wind and solar production ebbs.
Storage systems are considered more expensive than natural gas but costs are falling, and in an effort to expand the market, state policymakers in 2013 ordered the California’s three investor-owned utilities to buy a required amount of storage by 2020.
Bill Powers, an engineer and consumer advocate based in San Diego, said natural gas dominance is no sure thing, pointing to falling prices for alternative energy sources.
“If in a few years you can produce power at $25 a megawatt-hour from a solar field or buy it at a gas plant at $35, just on cost alone a lot of solar is going to be built, even in states where there’s no green mandate and no pressure to go green,” Powers said.
Zoback, of Stanford’s Natural Gas Initiative, isn’t so sure natural gas will lose its grip that quickly.
“My sense is that we’re going to see expanded use of natural gas for the next 20 years,” Zoback said. “In the following 20, it will have a useful decline; and 40 to 50 years from now, I think we will be using very little natural gas. We’ll largely have renewable sources.”