Few things are more essential to the way we live than electricity. And yet few are more often overlooked than the electricity grid that supplies it. Most of us simply assume that the power needed to keep our AC going and the lights on will always be there, and at an affordable price. That may be true for now, but it may not be in the very near future.
For one thing, market forces and government regulations have combined to shrink the number of electricity-generating power plants. Nuclear energy that supplies a fifth of our electricity is struggling. Nuclear plants are financially distressed. And bankruptcies and cost overruns have stymied new construction.
Coal power plants that just a decade ago provided more than half of the nation’s electricity now generate just a third. Government regulations and booming natural gas have decimated the coal fleet.
Meanwhile, environmental activists strongly oppose building either nuclear or coal plants, believing that wind and solar power can fill the gap. But replacing the 50 percent of electricity now supplied by coal and nuclear energy won’t be easy when wind and solar power meet less than 7 percent of our current demand.
That leaves natural gas to fill the gap. Optimists reassuringly point to our enormous supplies of natural gas. Experts who just a decade ago thought we would be helplessly reliant on imported gas now fret about a glut. Thanks to fracking technology that unlocked shale gas, the U.S. will become a net energy exporter next year if not before.
And that has some experts very concerned: won’t exporting natural gas, the fuel we’re relying on more than ever, raise its price here? It will if markets respond normally. That’s because exports offer producers a new, higher-value market. Last year, U.S. liquefied natural gas (LNG) found its way to more than 20 different nations and the U.S. Energy Information Administration expects U.S. LNG export capacity to grow sevenfold by 2019.
Natural gas producers see a rosy future. The CEO of oil and natural gas giant Continental Resources predicts U.S. natural gas exports could reach 30 billion cubic feet per day, equivalent to exporting 40 percent of current production.
That could potentially leave U.S. consumers, especially those who are heavily reliant on natural gas for their electricity and heat, with bigger utility bills and more volatile gas prices. A 2015 study for the Department of Energy concluded that “greater LNG exports raise domestic prices and lower prices internationally.”
Costlier electricity at home becomes even likelier if coal and nuclear power are no longer available to fill the gap. The U.S. Department of Energy is so concerned it has launched a study to examine the reliability of the nation’s power grid. Its report is expected soon.
With natural gas exports surging and the EV revolution now here, the safest course is to keep our coal and nuclear plants operating. It’s a recommendation the Energy Department would be wise to make.
We are better at preparing for the future than we are guessing what it will be. But we know we will be surprised. Let’s at least lower the risk that surprises may bring.
See the article here.
- On September 8, 2017