Shale gas boom is THE energy story of 2010; what it means for renewables
While it poses numerous threats to groundwater, the production of Marcellus shale gas is changing just about every dimension of the U.S. energy outlook. In the recently released summary of its 2011 projections, The U.S. Energy Information Administration increased its estimate of U.S. natural gas supply pointing to a continuing low price per million cubic feet at or under $5 possibly for the next decade, or longer. Just three years ago, natural gas sold for more than $12 per million cubic feet.
If the industry regulates itself effectively in the face of a growing chorus of protests, what does this mean?
1. Natural gas will increase its share of new electric power generation, making it increasingly difficult for solar and wind energy to gain a toehold in more markets, especially in states without renewable electricity requirements.
2. Natural gas — not renewables — will be able to meet a growing share of new generation needs created by the closure of aging, dirty coal-fired power plants.
3. Despite it’s classification as a fossil fuel, natural gas’ relatively low carbon emissions will enable utilities to stabilize carbon emissions.
4. A possible silver lining for clean energy: the moderating effect on standard-offer electric service supplied by more natural gas could help states adopt more renewables — perhaps even under long-term contracts — without raising overall prices. As is, the EIA projection shows renewables’ share of the electric generation pie rising from 10% in 2009 to 14% in 2023, the largest percentage increase of any fuel.
5. As for the nuclear renaissance: don’t hold your breath — but keep an eye on your pocketbook.
Note the EIA’s projecting a near-elimination of U.S. natural gas imports by 2035.