No Surprise: Natural Gas Played Vital Role In Reducing Power Sector Emissions

The shift to abundant, affordable natural gas over the past 15 years has played a critical role in helping to reduce U.S. power sector CO2 emissions more quickly than projected, according to a new report from Berkeley Labs, which found that natural gas contributed to 48 percent of that decline.

“Natural gas generation grew from 761 billion kWh in 2005 to 1,617 billion kWh in 2020. Assuming this growth only displaced coal and considering the relative emissions rates of gas and coal, we estimate that increased natural gas supply reduced 2020 CO2 emissions by 470 MMT or 48 percent of the total emissions reduction since 2005.” (emphasis added)

The study, prepared for the Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE), finds that emissions in the power sector fell dramatically from 2005 to 2020, despite previous forecasts that there would be a steady rise:

“Fifteen years ago, many business-as-usual projections anticipated that annual carbon dioxide (CO2) emissions from power supply in the United States would reach 3,000 million metric tons (MMT) in 2020. In fact, direct power-sector CO2 emissions in 2020 were 1,450 MMT—roughly 50% below the earlier projections. By this metric, in only 15 years the country’s power sector has gone halfway to zero emissions. Other metrics also evolved differently than projected: total consumer electricity costs (i.e., bills) were 18 percent lower; costs to human health and the climate were 92 percent and 52 percent lower, respectively; and the number of jobs in electricity generation was 29 percent higher.” (emphasis added)

This unexpected progress came about from a variety of “economic, technical, and policy factors,” according to the report, including the increased use of natural gas for power generation:

“Coal-to-gas fuel switching played a crucial role, with natural gas generation growing rapidly, driven by the shale gas revolution and the difference between projected and actual fuel prices.” (emphasis added)

The shale revolution helped drive down natural gas prices – actual prices were 67 percent lower than previously projected – that in turn made the fuel more economically viable and enabled natural gas-fired electricity generation to grow 112 percent since 2005.

Lower Emissions Lead to Climate and Health Benefits

Reduced emissions have also decreased climate costs and health impacts. As the study explains:

“Climate damages from power-sector carbon emissions in 2020, estimated at $110 billion, were less than half the $229 billion that would have been incurred under the (Energy Information Administration’s 2005) projection.”

Meanwhile, health costs were grossly overstated by $385 billion:

“Health costs, at $34 billion, were reduced by more than 90 percent relative to the $419 billion projected for 2020, owing to reduced coal generation and stronger emissions regulations. Premature deaths from power-sector air pollution in 2020 (3,100 lives lost) were just 8 percent of what might have been under the business-as-usual trajectory (38,000 lives lost).”

The end result is tremendous social benefits for Americans, thanks in large part to the shift to natural gas:

“In total, the calculated social cost of power supply— considering electricity bills, climate damages, and health impacts – in 2020 of $535 billion was 44 percent lower than in 2005 ($948 billion) and 52 percent lower than projected for 2020 ($1,124 billion).”

Conclusion

Achieving a net-zero power grid isn’t something that can happen overnight. It’s going to take complex actions that not only reduce emissions but factor in accessibility, affordability, reliability, and resiliency into any policy decisions.

It will involve making facilities more efficient, employing innovative technologies like carbon capture and a diverse array of energy sources like renewables, hydrogen, nuclear, and yes, natural gas.

But one thing is already clear from this report: The United States is making tremendous strides to reduce emissions – far outpacing projections for doing so – and natural gas has been a major part of those successes.

Read more at EID Climate