It’s Natural Gas vs Coal As Renewables Rise

Key Takeaways:

  • Many utilities are closing coal plants and replacing them with natural gas to supplement renewables
  • Transitioning to 100% renewables isn’t feasible without natural gas providing flexible and reliable power
  • Even some of the slowest utilities to cut emissions are turning to gas as an alternative to coal

With plans to build at least 150 new gas plants in the U.S. along with thousands of miles of pipelines, the future of at least one fossil fuel appears strong. As utilities, investors and analysts in the clean energy transition understand, the path to 100% renewables doesn’t mean a rapid switch to fully solar- and wind-sourced energy. The argument for natural gas vs coal for feasibly transitioning to 100% renewables has cropped up in many areas. Some areas replacing coal plants with renewables, leverage flexible, natural gas-powered plants to guarantee reliable energy to their grid. Essentially, the argument goes that both gas and renewables are necessary for the clean energy transition to succeed.

However, there are clear efforts to avoid not using this transition pathway.  For example, New York passed a sweeping energy law requiring the state to generate 100% of its electricity from carbon-free sources by 2040. California, Colorado, Maine, Nevada, New Mexico and Washington have all passed similarly ambitious legislation aiming for carbon neutrality by mid-century. Still, many regions across the United States are largely in agreement that natural gas is vital to their work on making the switch to renewable energy.

Take Duke Energy, a utility has committed to closing coal plants in North and South Carolina and replacing them with 9.5 Gigawatts of gas-fired capacity —because for their company, this is a financially sound choice. “Right now, gas is still the most cost-effective option for us,” said the utility’s director of renewable strategy and policy, Kenneth Jennings. Meanwhile Tampa Electric in Florida is replacing two old coal plants with a new gas plant that “will form the backbone of its energy mix” as it makes its transition to solar.

Due to growing climate concerns and a steady decline in the cost of wind, solar and other renewables technology, there are many who argue it is time to stop building gas plants altogether. Some states like Arizona and Indiana have already blocked plans for new gas plants according to that rationale. However, every area and region will behave differently in its transition towards 100% renewables (because there is no “one size fits all”). Until a the move is complete, these transition challenges, their ensuing solutions, and the choices made will all come under intense debate.

 

What We’re Reading: Extract from, “As Coal Fades in the U.S., Natural Gas Becomes the Climate Battleground” (The New York Times)