Shale Gas News and Information
US Solar Chief on natural gas
- Written by Nick Grealy
- Published: 11 January 2013
Further proof natural gas in general and shale in particular aren't an enemy of renewables comes from the head of San Francisco's Recurrent Energy, a successful generator of solar electricity at utility scale. Judging by the amount of people who pick fights on Twitter, much of the opposition to shale gas in the UK comes from small installers of solar panels. For example one of Frack Off's founders is one in Brighton and yet a consistent denier that he has any economic incentive from the campaign, economic self interest being reserved solely for the fossil fuel industry it appears. I first caught this via a story in the San Francisco Chronicle but this is from Recurrent CEO Arno Harris's blog:
Gas is now trapped within the geographic boundaries of North America because we don't have the facilities to export gas to markets in Europe and Asia.
The oversupply trapped in the U.S. has caused the domestic price to collapse to by more than 50% to $2-$3 per thousand-cubic-feet (Mcf). That's a fraction of prices in Europe where gas goes for $10-$11 per Mcf or those in post-Fukushima Japan which are over $17 per Mcf.
The severity of oversupply in the U.S. relative to global markets offers an opportunity for the United States to achieve something it has never had: a comprehensive energy plan that makes sense in terms of our economy, national security and public health. Better yet, it could rally support from interest groups previously at odds. How? By embracing natural gas exports. This would not only take the slack out of the natural gas market , but by doing so enable renewable energy to become the backbone of our power generation infrastructure.
UK solar people would say that's easy for him to say, they will lose market share if gas prices fall. But not only does Arno Harris actually generate solar power far more than in the UK, he thinks bigger picture too. First the benefit for the US:
The renewable energy industry should absolutely get behind the idea of exporting natural gas. If gas prices were still at the levels they were three years ago, wind and solar would be solidly competitive with fossil-fired power. And the utility-scale renewable industry wouldn't be fighting the headwinds it is today. Exporting gas would increase demand and raise gas-fired power prices to a level that would help wind and solar by improving their competitiveness.
What's the benefit for the planet, especially our part of it? He's a businessman, but like the rest of us, he knows we're all in this together.Climate change is a global problem, requiring global solutions.
But why should climate advocates get behind exporting natural gas? Wouldn't that just increase the amount of carbon we're putting into the atmosphere? One of the big downsides of our gas glut in the U.S. is that we're now exporting our coal to Europe. Cheap domestic gas is replacing coal at home but that coal is simply being burned elsewhere. Thus the result of low gas prices is to increase global carbon emissions because total fossil fuel consumption is exploding.
Exporting natural gas would be more likely to displace coal both at home and abroad, resulting in a lower net carbon emissions overall. This alone gives climate advocates a reason to support the export of natural gas. Beyond that, any economist will tell you that raising the price of a commodity should increase rationing of that product. In other words, raising the price of gas should result in burning less of it and lead to more selective consumption.
Back in the SF Chronicle he mentioned how solar is also seeing drops in costs:
“Everybody knows we’re in this cheap gas environment,” Harris said. “Gas-fired electricity today is probably five cents or six cents per kilowatt hour, wholesale.” But new solar plants that Recurrent Energy is building will sell power to utilities as low as seven cents a kilowatt hour
I really wish UK Greens would wake up to reality.The only logical reason I can see for opposition is a wish to protect a narrow self interest, fears that I think both misguided and ultimately providing a perverse outcome to what they insist they, and anyone who supports the science of climate change like myself, is seeking to accomplish.
Paradoxically, the U.S. gas boom has encouraged coal exports to Europe, where U.S. coal is cheaper than natural gas from Russia, which controls most of the gas supply to Europe. The price shift has made it more difficult for European countries to meet their carbon emissions targets.
“That coal is still coming out of the ground, it’s just all going to Europe,” Harris said. “They are switching from Russian gas to American coal, so overall, even though we’re keeping the natural gas here, it is still resulting in a big uptick in carbon emissions because we’re still pulling all that coal out of the ground. We’re just not burning it here.”