Natural Gas Overlooked In Obama's Clean Power Plan

Posted on February 29, 2016
Posted By: Vincent Scatena
It is now apparent that the Obama Administration's Clean Power Plan aims to significantly reduce the amount of power generated by coal. It's a game changer for utilities, mining companies and equipment suppliers. And, it's another spotlight moment for renewables but in the long run, the real champion will be natural gas.

The final CPP rules issued by the EPA on Aug. 3 reflect important revisions from those proposed in 2014, including some that were detrimental to the survival of the power industry. But the fact remains that the federal government is focused on increasing power from sources like wind and solar while cutting power from coal.

What is not fully considered by this new federal focus is the importance of natural gas in the overall equation; that's where the plan misses the mark. Natural gas remains the only viable choice to reach the plan's goals. CPP seeks to reduce CO2 emissions in 2030 by one-third from 2005 levels. States have up to three years to submit their own reduction plans.

As states develop compliance plans, they are "dependent on natural gas combined cycle turbines to pick up the slack when the sun doesn't shine and the wind doesn't blow," says America's Natural Gas Alliance (ANGA).

The White House's plan perpetuates a false choice between renewables and natural gas, says ANGA. The plan is "disingenuous" and ignores market realities for gas to provide much of the nation's power while reducing emissions.

The industry trade group also notes the irony in the Energy Information Administration's routine release of power generation data for April 2015, one day after the release of Obama's plan. In that month, according to the EIA, the US generated more electricity from natural gas than any other fuel source, including coal. That was the same month the country emitted less CO2 into the atmosphere than at any time since 1988.

"That's no coincidence," observes ANGA. And, as the most cost-effective and flexible option for power generation, natural gas "will balance the dual mandates of cleaner air and healthy economic growth."

Supporters of renewables were quick to underscore the ways the Obama plan discourages a "rush to natural gas," due to its risks to consumers, public health and the climate. A report by one group notes the plan incentivizes "zero-carbon energy sources," requires state compliance plans to meet a renewables target, limits gas combined cycle power to 22 percent above 2012 levels, and closes a loophole for new source gas plants.

What's more, to illustrate the significant leverage given coal in the economy and power grid, 16 states filed protests with the EPA seeking to delay the rule while legal challenges are sorted out.

In the meantime, natural gas will play a pivotal role in reliably powering the economy and reducing emissions.

"The president's plan to reduce power plant emissions from higher-carbon fuels would greatly benefit from a clear emphasis on a clean, abundant, efficient fuel like natural gas," said Nicholas Nadjarian, chief executive officer at Industrial Motor Power Corp, a leading power provider to O&G. "We can expect a steady increase in natural gas use in the power sector and are prepared to provide targeted solutions for our customers."

By Dan Larson, journalist for IMP Corp. - Los Angeles, CA - September 23, 2015

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Covering all power generation news for O&G, drilling, mining, utilities and marine sectors since 2012.

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February, 29 2016

Richard Vesel says

Part 1 of 3

It's not overlooked at all. Maybe you should actually research this topic from within the primary source, the CPP, rather than parrot a bunch of second-or-third-hand nonsense.

Not sure what documents YOU read, but here's how gas generation is relied upon in the CPP:

Power bid stack tilted in favor of lower emission generation sources: Gas is 40% to 70% lower in CO2 emissions, depending upon how it is used.

Fuel switching: full change-over of boiler fuels to gas, co-firing with gas

Here's text directly from the pages of the final rule, as issued on 8/3/2016. Too much there to do the whole 1560 pages, so I will just show the first 30% of the document. (You should be sufficently interested to find and read the rest yourself.)

Pages 27 and 230: [See item 2]

In this final action, the agency has determined that the BSER comprises the first three of the four proposed “building blocks,” with certain refinements to the three building blocks. The three building blocks are: 1. Improving heat rate at affected coal-fired steam EGUs. 2. Substituting increased generation from lower-emitting existing natural gas combined cycle units for reduced generation from higher-emitting affected steam generating units. 3. Substituting increased generation from new zero-emitting renewable energy generating capacity for reduced generation from affected fossil fuel-fired generating units.

Page 45:

While pollution will be cut from power plants overall, there may be some relatively small number of plants whose operation and corresponding emissions increase, as energy providers balance energy production across their fleets to comply with state plans. These plants are likely to be the highest-efficiency natural gas-fired units, which have correspondingly low carbon emissions and are also characterized by low emissions of the conventional pollutants that contribute to adverse health effects in nearby communities and regionally.

(continued in part 2 of 3)

February, 29 2016

Richard Vesel says

Part 2 of 3

Page 160:

In recent years, the nation has seen a sizeable increase in renewable generation such as wind and solar, as well as a shift from coal to natural gas.

Page 161:

Between 2000 and 2013, approximately 90 percent of new power generation capacity built in the U.S. came in the form of natural gas or RE facilities.

Page 317:

Importantly, affected EGUs also have available numerous other measures that are not included in the BSER but that could materially help the EGUs achieve their emission limits and thereby provide compliance flexibility. Examples include, among numerous other approaches, investment in demand-side EE, co-firing with natural gas (for coal-fired steam EGUs), ...

Page 324:

These programs also demonstrate that replacement of higher-emitting generation with lower-emitting generation -- including generation shifts between coal-fired EGUs and natural gas-fired EGUs and generation shifts between fossil fuel-fired EGUs and RE generation –- also reduces emissions.

Page 336:

The less expensive options include shifting generation to existing NGCC units -- an option that has become particularly attractive in light of the increased availability and lower prices of natural gas...

Page 337:

Although the presence of lower-cost options that achieve the emission reduction goals mean that the EPA is not identifying either natural gas co-firing or CCS at coal-fired steam EGUs, or heat rate improvements at other types of EGUs, as part of the BSER, those controls remain measures that some affected EGUs may be expected to implement and that as a result, will provide reductions that those affected EGUs may rely on to achieve their emission limits...

Page 340:

(a) Substituting generation from lower-emitting affected EGUs for reduced generation from higher-emitting affected EGUs. In the proposal, the EPA observed that substantial CO2 emission reductions could be achieved at reasonable cost by increasing generation from existing NGCC units and commensurately reducing generation from steam EGUs. Because NGCC units produce much less CO2 per MWh of generation than steam EGUs –- typically less than half as much CO2 as coal-fired steam EGUs, which account for most generation from steam EGUs –- this generation shift reduces CO2 emissions. We also noted that because NGCC units can generate as much as 46 percent more electricity from a given quantity of natural gas than a steam unit can, generation shifting from coal-fired steam EGUs to existing NGCC units is a more cost-effective strategy for reducing CO2 emissions from the source category than converting coal-fired steam EGUs to combust natural gas or co-firing coal and natural gas in steam EGUs.

(continued in part 3 of 3)

February, 29 2016

Richard Vesel says

Part 3 of 3

Page 371:

In addition, trading incentivizes affected EGUs to consider low-cost, non-BSER methods to reduce emissions as well, and, as discussed below, there are numerous non-BSER methods, ranging from implementation of demand-side EE programs to natural gas co-firing.

Page 421:

...shows that sources are able to replace coal-fired generation with natural-gas fired generation and add incremental amounts of RE (as well as take other actions, such as implement demand-side EE programs), on a gradual basis, after a several-year lead time, over an extended period, as provided for under the final rule.

Pages 434-435:

Coal combustion for electricity generation produces large volumes of solid wastes that require disposal, with some potential for adverse environmental impacts; these wastes are not produced by natural gas combustion. The intake and discharge of water for cooling at many EGUs also carries some potential for adverse environmental impacts; NGCC units generally require less cooling water than steam EGUs.420 With respect to energy impacts, building block 2 represents replacement of electrical energy from one generator with electrical energy from another generator that consumes less fuel, so the overall energy impact should be a reduction in fuel consumption by the overall source category as well as by individual affected coal-fired steam EGUs. Although for purposes of this rule we consider the incentive for technological innovation only in the alternative, we note that building block 2 promotes greater use of the NGCC technology installed in the existing fleet of NGCC units, which is newer and more advanced than the technology installed in much of the older existing fleet of steam EGUs.


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