We just added a brief on natural gas to its Climate TechBook that helps to explain why natural gas is unique among fossil fuels. Natural gas is both a contributor to climate change (natural gas combustion accounts for about 16 percent of total U.S. greenhouse gas emissions) and an option for reducing emissions since natural gas is less carbon-intensive than coal and petroleum. The United States could actually reduce total greenhouse gas emissions by burning more natural gas if it’s displacing other fossil fuel use (this is particularly the case for fuel switching from coal to gas in power generation).
Like coal, but unlike petroleum, natural gas is primarily a domestic energy resource, with net imports of natural gas constituting only about 13 percent of U.S. consumption and about 90 percent of imports coming from North America. Unlike coal (93 percent consumed for electricity generation) and petroleum (more than two thirds used for transportation), natural gas consumption is more evenly split across the electric power, industrial, residential, and commercial sectors.
The past few years have seen a “revolution” in the outlook for natural gas supply. Until recently, experts thought that the United States would become increasingly dependent on expensive imports of liquefied natural gas (LNG) from overseas, but the recent boom in domestic “unconventional” gas production (driven by shale gas) and the dramatically increased estimate of U.S. gas reserves have led to projections of increasing domestic natural gas production and declining imports.
Natural gas is receiving a lot of attention in the discussion about U.S. climate and energy policy. The gas industry is pressing for favorable treatment in possible climate and energy legislation, with a specific set of policy priorities recently put forth by a major industry lobby group.
While some tout natural gas as a “bridge fuel” to a low-carbon future others fear that a “dash for gas” (i.e., fuel switching by electric power generators) could increase demand for and the price of natural gas, thus negatively impacting manufacturers that rely on natural gas for energy and as a feedstock.
Recent analysis by the U.S. Energy Information Administration (EIA) of the climate and energy bill passed by the House in June 2009, illustrates how the projected role of natural gas in reducing U.S. greenhouse gas emissions depends in large part on the use of offsets under cap and trade and the relative cost and commercial availability of low-carbon technologies (e.g., wind, solar, carbon capture and storage, and nuclear power). When low-carbon technology deployment and offsets are constrained, EIA finds a much heavier reliance on natural gas for electricity generation under cap and trade, but the new outlook on U.S. natural gas supply means that even this pessimistic scenario does not lead to major increases in projected natural gas prices.
A new modeling analysis from Resources for the Future (RFF) sought to quantify the implications of the dramatically expanded U.S. natural gas supply. RFF researchers found that without new energy and climate policy, more abundant and less expensive natural gas could actually mean slightly higher U.S. greenhouse gas emissions in 2030 than would otherwise be the case (as cheaper natural gas competes with non-emitting energy sources and increases total energy consumption).
This last point brings us back to the overarching importance of implementing a policy that puts a price on carbon, as a greenhouse gas cap-and-trade program would do. Putting a price on carbon would harness market forces to drive the deployment of a portfolio of low- and lower-carbon technologies and fuels, including increased natural gas use to the extent it can cost-effectively reduce emissions.
Steve Caldwell is a Technology and Policy Fellow
Transportation experts gathered in Washington last week for the Transportation Research Board’s 89th annual meeting. With over 10,000 participants and 600 sessions, it is hard to draw any crosscutting conclusions from the conference. With an eye on climate change, however, the TRB meeting indicated the transportation community is engaged and ready for reform. One of the conference’s hot topics addressed the potential to reduce greenhouse gas (GHG) emissions by limiting vehicle miles traveled (VMT). VMT is one of the four major influences on transportation GHG emissions. The others are vehicles, fuels, and the overall efficiency of our transportation system. We need policies to address all four.
At a session entitled “Vehicle Miles Traveled Reduction Targets: Will This Strategy Get the Desired Results?,” the participants debated the effectiveness of VMT targets on reducing GHG emissions. Reducing driving may have been unimaginable in the previous era of urban sprawl and Eisenhower’s interstate highway system, but a confluence of interests in promoting livability and combating climate change has ushered in a new way of thinking about transportation. The idea of limiting VMT is not without its critics, however. Research is ongoing as to how much VMT can really be reduced, on the precise relationship between VMT and GHG emissions, on the costs and benefits of transportation alternatives, and on the distribution of those costs and benefits geographically and by income class.
Perhaps it was the panelists’ connection to the glory days of transportation in the United States or their own economic analyses, but they were mostly skeptical with respect to the efficacy of using VMT targets to reduce GHG emissions. As one speaker put it, “VMT is about technology versus behavior,” meaning lawmakers would use VMT targets to affect behavior due to a lack of confidence in technology.
Another speaker defined VMT targets and the subsequent effects on land-use policy as a “blunt instrument.” They argued VMT reductions would force a reorientation of the population in the United States without necessarily reducing GHG emissions. Furthermore, one panelist claimed VMT targets would be highly regressive.
The lone advocate for VMT targets acknowledged some of these detractions, but strongly pushed for the policy as a “good starting point” towards greater land-use reform. His research showed an economic benefit (i.e., jobs) from spending less on transportation, since people tend to spend that extra money on more labor-intensive products. He also highlighted polls and recent trends indicating that people want to live closer together. Lastly, the co-benefits of reducing VMT including improved safety and reduced congestion make the policy worthwhile even without considering the environmental benefits.
The panelists agreed on some things – for example, that researchers do not fully understand transportation behavior, and that there are substantial co-benefits of reducing VMT. They also agreed that a VMT tax would be preferable to the current Federal gasoline tax as a means of maintaining the surface transportation system, though they disagreed over its effects on GHG emissions. Enacting that policy, however, is politically challenging.
A proposal by Rep. James Oberstar (D-Minn.) to reform fundamentally the current transportation system stalled in 2009, and the legislative prospects in 2010 are unclear. In the absence of comprehensive reauthorizing legislation, action by the Administration – for example, through the Federal budget and U.S. Department of Transportation (DOT) rulemaking – will be critical, as will state and local innovation. We could begin to see this needed leadership from the Administration in the form of the President’s budget, which is set for release on February 1st. DOT does have some discretion to improve federal transportation programs under its existing legislative authorities, and the President’s budget could include such reforms. The President could also propose more significant changes, but that would require Congressional approval.
Nick Nigro is an Innovative Solutions Fellow
This post also appears on the National Journal Energy & Environment Experts Blog.
With Thursday’s floor statement by Senator Murkowski (R-Alaska) announcing her joint resolution to override EPA’s endangerment finding, we were introduced to a new term to add to our lexicon – a disapproval resolution. If like me, you only had a vague recollection that Congress had given itself the ability to override any new federal regulation, some quick research was in order.
If you take a look today at page A16 of today's Wall Street Journal, or inside the pages of the Politico, you will find something remarkable. Just a day after some pundits declared that energy and climate legislation could be off the agenda after the Massachusetts election, a diverse group of 88 organizations has come together to say the exact opposite. The message is unambiguous: Democrats, Republicans, and Independents should unite behind bi-partisan, national energy and climate legislation that increases our security, limits emissions, while both preserving and creating jobs.
There is a great deal of speculation in the press and in the world of punditry about how the Massachusetts election will change the Obama administration’s agenda this year. For the climate issue there are clear implications, but no death knell.
It is worth pointing out that this election represents only one vote in the Senate. But the real issue is how the moderate, swing senators will react, and whether they pull back on supporting climate action. This election does not change the fact that support from moderate senators in both parties is needed to pass a strong climate-energy bill.
While an economy-wide program to reduce emissions remains the ultimate objective, I believe there are many ways to get there.
It’s critical that we find ways to promote low-carbon energy and reduce power sector emissions while accelerating the creation of clean energy jobs and promoting economic growth. I continue to think we have a decent chance of getting meaningful legislation this year that reduces emissions and starts us on a path toward a clean energy future.
Eileen Claussen is President