Gas: The unique alternative

Moisés Naím / World Energy & Oil

We know the story: Mother Nature is sending increasingly loud and frequent signals that something new and dangerous is afoot. Regularly, climate scientists release incontrovertible data showing that climate is changing and offer robust explanations of why this is happening. We also know the other part of this story: Not enough is being done by peoples and governments to alter a trajectory that is guaranteed to force drastic changes in the human condition.

The American Meteorological Society warns that unless concerted action is taken by all nations, there is an almost certain probability that global temperatures will rise by 4 to 7 degrees Celsius in the next one hundred years. A world with that average surface temperature is very different from the one humans have inhabited since they first appeared in the planet. We also know that, recently, this story included a twist that is as unprecedented as it is welcome: on December 2015 in Paris, 177 nations agreed to transform the planet into a low-carbon economy. The COP21 signatories committed to combat climate change, while promoting adaptation to its already irreversible effects. From then to October 2016, 96 countries have already ratified this agreement, which includes the goal to limit to no more than two degrees Celsius the increase of the average global temperature. This goal cannot be accomplished unless fossil fuel consumption is significantly replaced by less contaminating sources of energy and, eventually, by green, clean renewable sources. Countries that have ratified COP21 are now committed to monitor their efforts to reduce emissions, to take action to ensure that their targets are being met, to help bring underperformers in line and to help developing countries both to reduce emissions and to adapt to the impact of the already irreversible changes in climate. Going from a high to a low carbon economy is a process that will require time, although the growth of renewable energy has been much faster than expected. Renewable sources of energy have already overtaken coal as the world’s largest source of electric power. The EIA reports that two new wind turbines are built every hour in countries like China. Solar, wind and other renewable sources are already generating about 25 percent of the world’s electricity. In the U.S., wind and solar capacity has tripled in the last 6 years and a new report from the U.S. Energy Information Agency finds that electricity generated by solar and wind sources grew faster in 2014 than electricity generated by fossil fuels. This expansion has been greatly helped by the plummeting costs of renewable energy technologies. Since 2008 the costs of solar and wind energy have fallen by 80 percent and 50 percent respectively. Worldwide, renewable energy already represents close to 10 percent of total world energy generation and this rate of growth is expected to increase. In fact, the U.S. Energy Information Administration forecasts renewable energy will be the fastest-growing power source through 2040. So, yes, it looks that some kind of energy transition has already begun. This impressive growth in the use of renewable energy is largely taking place in the electricity sector. Unfortunately, other sectors are lagging.

Transportation, for example, continues to run by and large on fossil fuels. Even the most optimistic reports on the growth of renewables cannot eliminate concerns that the transition from a high to a low carbon economy is not going fast enough. The International Energy Agency scenarios suggest that there are low probabilities of staying below a warming of two degrees Celsius unless more substantial policy actions are taken to reduce carbon dioxide emissions.

This is where natural gas can play a decisive role. This fuel emits 50 to 60 percent less carbon dioxide when combusted in a new power plant compared with emissions from a coal plant and 15-20 percent less tailpipe emissions than gasoline when burned in today’s typical vehicle. The world is faced with two major tasks: reducing emissions stemming from carbon-based energy usage and slowing down energy demand through increases in productivity. Achieving these tasks requires a complex mix of financial, technical and political conditions that have proven to be very hard to achieve. The election of Donald Trump as president of the United States has added an additional level of complexity, as he has stated that climate change is a hoax perpetrated by China. He has also indicated that he intends either to dismantle or overhaul the U.S. Environmental Protection Agency and roll back president Obama’s regulations aimed at curbing coal industry pollution. Even though, as presidentelect, Mr. Trump has tempered his stance and has said that he has “an open mind” about global warming, a U.S. Administration less committed to combating global warming effectively could create serious delays in achieving even the COP21 minimum goals. A less enthusiastic U.S. administration is likely to slow down the already alarmingly slow pace at which the transition into a planet that consumes cleaner energy is taking place. It becomes urgent, therefore, to aim at an intermediate stage of a cleaner planet, while continuing to fight for all the other more ambitious goals. This intermediate stage can be greatly helped by an intensive substitution of oil by natural gas. In fact, the energy industry has already developed a significant technical and financial infrastructure that would make natural gas the path of least resistance. The strong positioning of natural gas in the current energy mix and its cleaner characteristics, as compared to coal and oil, makes it an almost unique alternative in our transition towards a low carbon economy.