Renewables and natural gas have not traditionally been close allies. Natural gas has been described as a bridge to the future with renewables as a destination, but this vision does not include much co-existence of the fuels in the meantime. That is ironic because despite the differences in political supporters, this odd couple could work extremely well together. They both have substantial environmental benefits when compared with coal, and in the short run, natural gas can serve as the backup fuel to deal with the problem that some renewables, such as wind power, are intermittent. Natural gas peaking facilities can be ramped up and down quickly to match demand, facilitating system stability for the integration of intermittent renewables.
Still, many advocates of either natural gas or renewables view the other competitively. This subject was discussed at recent meetings I attended at the Aspen Institute in Colorado.
With huge new shale deposits now accessible (see Dr. Medlock’s presentation), natural gas prices have fallen so dramatically that it no longer makes much sense to build much renewable capacity, and installations of new wind capacity in the first half of 2010 are down 71% from last year. Increasing wind generation, particularly in Texas, has reduced demand for natural gas; a 2008 study concluded that 81% of wind in Texas displaced natural gas.
While the new shale deposits of natural gas could offer tremendous energy security benefits to the U.S., some advocates of renewable energy just cannot seem to embrace this low carbon fossil fuel. But the reality is that it is not feasible to scale up renewables to replace coal, much less all fossil fuels, in any time frame other than decades. Similarly, only using natural gas to displace all coal used for electricity would require nearly a tripling of natural gas in the electricity sector, increasing the consumption of domestic natural gas delivered to consumers by about 60 percent (roughly 12.6 tcf).
Thus we urge all parties to rethink themselves. Renewables and natural gas can find common ground, and the transition to both will benefit society at large. New EPA regulations on air pollutants that contribute to smog and asthma should help shut down the least efficient coal plants, providing a new market while benefitting public health. Rapid depreciation of investment costs benefitted natural gas wildcatters that opened up the shale play, and they can encourage private capital in renewables as well. The Senate energy bill encourages electric vehicles, increasing electricity demand that can be met with natural gas and renewables and helping to reduce foreign oil consumption.
Texas is a good experiment for how natural gas and renewables can co-exist and may be able to thrive together. In the long-run, Baker Institute scholar Peter Hartley believes wind will displace more baseload coal because wind more consistently blows at night (see Dr. Hartley’s presentation). This odd couple, long estranged and weary of each other, could be working together to dramatically improve our environmental quality.