Most environmentalists would cheer the discovery of cheaper ways to generate electricity from wind or solar power. They would lament the news that prices are dropping for dirty fuels like coal or oil. But what about natural gas? Are abundant supplies and low prices for natural gas good for the environment–or not? Is natural gas a “bridge” to a clean energy future? Or is it a detour?
These aren’t hypothetical questions, of course. Natural gas supplies are growing and prices are down. As The Walt Street Journal reported last year:
A massive natural-gas discovery… in northern Louisiana heralds a big shift in the nation’s energy landscape. After an era of declining production, the U.S. is now swimming in natural gas.
…Huge new fields also have been found in Texas, Arkansas and Pennsylvania. One industry-backed study estimates the U.S. has more than 2,200 trillion cubic feet of gas waiting to be pumped, enough to satisfy nearly 100 years of current U.S. natural-gas demand.
Some people will tell you this flood of natural gas will displace coal, and thereby reduce carbon emissions. This was the theme of a recent report from Deutsche Bank Climate Change Advisors. (See Coal’s unknown and unknowable future.) Others in the pro-natural gas camp, notably oil and gas mogul T. Boone Pickens, tout natural gas as a clean alternative to gasoline or diesel in cars and trucks. His Pickens Plan says that natural gas is “a bridge fuel to slash our oil dependence while buying us time to develop new technologies that will ultimately replace fossil transportation fuels.”
But some environmental advocates worry that cheap natural gas will deter much-needed investment in renewable power. In a live chat last week with David Roberts of Grist, Mike Brune of The Sierra Club said this:
Here’s our position on gas: it burns more cleanly than coal or oil, but it is not clean. When coal plants are retired (or new ones are not built), we believe that the right “loading order” for new energy sources would be: energy conservation and efficiency, solar and wind (preferring distributed over large-scale), geothermal and perhaps some wave energy, then natural gas to fill in the rest.
And there’s a good deal of controversy about the environmental impact on natural gas, particularly when it’s extracted using a technique known as hydro-fracking. ProPublica, a nonprofit investigative news site, has done a superb job of covering this story; see Buried Secrets: Gas Drilling’s Environmental Threat. Kudos to my former FORTUNE colleague Abrahm Lustgarten, who has written dozens of stories in this series won a George Polk Award for his work.
I honestly don’t know what to think about natural gas, so I’m looking forward to the webinar.
David Hone is Climate Change Advisor for Shell since 2001, as well as a board member and Vice Chairman of the International Emissions Trading Association (IETA). He also works closely with the World Business Council for Sustainable Development and has been a lead contributor to many of its recent energy and climate change publications. David has worked as a refinery engineer in Australia, an oil economics and supply specialist and the Netherlands, and finally manager of the global trading and chartering of Shell’s crude oil tanker fleet, before taking his current position.
Geoffrey Styles is Managing Director of GSW Strategy Group, LLC, an energy and environmental strategy consulting firm. His industry experience includes 22 years at Texaco Inc., culminating in a senior position on Texaco’s leadership team for strategy development, focused on the global refining, marketing, transportation and alternative energy businesses, and global issues such as climate change. Previously he held senior positions in alliance management, planning, supply & distribution, and risk management. His “Energy Outlook” blog has been quoted frequently by the Wall Street Journal and was named one of the “Top 50 Eco Blogs” by the Times of London.
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