The natural gas industry wants to ensure it has a role in a carbon-neutral future.
To do so, the industry is positioning itself as the quickest way to clean up the electricity grid in the near term and preparing its infrastructure to transport the fuels of the future.
Natural gas can help bend the U.S. greenhouse gas emissions curve sharply downward in the short term, said Diane Leopold, the executive vice president and co-chief operating officer of Virginia-based utility Dominion Energy.
Because of that, it’s an asset to power companies that are looking to slash their emissions to net-zero by 2050, Leopold told the Washington Examiner in an interview. Her own utility set such a target in February.
This year, Leopold is chairing the American Gas Association, which represents more than 200 energy companies that deliver natural gas in the United States. In that role, she’s helping the industry chart a course forward not just for the next year but for the long haul.
“It’s not that I just want to be net-zero by 2050. I want to reduce today, and I want to reduce tomorrow,” Leopold said. “So what are the things that we can do to really get the emissions down, invest in technologies that can really support net-zero as fast as possible?”
Leopold has developed a three-pronged mantra to guide natural gas companies’ work. The pillars are protecting the people by providing reliable service, which she said has taken on a whole new meaning amid the pandemic; preserving the environment by addressing climate change; and harnessing the potential of new, cleaner ways to use natural gas.
Nonetheless, Leopold’s vision comes as the natural gas industry is increasingly under political threat. Many climate activists don’t see a significant role, if any at all, for natural gas in the energy system of the future.
Even though natural gas burns cleaner than coal, the fuel has generated a larger share of total U.S. emissions as it becomes more widely used. Overall in 2019, 33% of U.S. energy-related carbon emissions came from burning natural gas, according to the Energy Information Administration. Natural gas electricity generation also accounted for 38% of the power sector’s emissions in 2019, per the EIA.
Utilities building new natural gas plants are facing tough scrutiny to say how that construction squares with their broader climate goals. Major natural gas pipelines have seen significant setbacks as they get caught up in legal challenges.
Dominion, for example, and its partner Duke Energy were forced to cancel the Atlantic Coast pipeline, a roughly 600-mile pipeline set to bring gas from West Virginia to Virginia and North Carolina, after legal delays and other hurdles ballooned the project’s costs to $8 billion.
In addition, some cities with aggressive climate targets are beginning to ban natural gas appliances from new homes and buildings, an effort the American Gas Association and other industry groups are fighting vigorously.
Karen Harbert, president of the American Gas Association, is undeterred, however.
“There’s going to be a role for natural gas in different parts of our country for many, many decades to come,” she told the Washington Examiner. Even with setbacks for high-profile pipelines like the Atlantic Coast project, Harbert said the industry has added 5 billion cubic feet of additional capacity this year.
Beyond the fuel itself, natural gas infrastructure can play an even bigger role in the future, Harbert said, because it can be used to transport lower-carbon fuels such as renewable natural gas (gas derived from organic waste like cow manure) and green hydrogen, which is produced with excess solar and wind power.
“We’ve got 2.6 million miles of pipeline in this country,” Harbert said, suggesting it would be foolish to abandon that infrastructure and rely solely on electricity for everything, including heating and other appliances.
That amount of electrification, she argued, would require a massive build-out of transmission lines.
“If it’s hard to build an underground pipe that you can’t see, imagine the difficulty in building the above-ground transmission lines” that would be needed to carry more renewable energy across the country and meet that increased demand, she added.
And even an all-electric scenario would rely on some natural gas power generation, “so natural gas never goes away under any scenario,” Harbert said.
Still, the natural gas industry is making a concerted effort to invest in lower-carbon fuels.
Dominion, for example, plans to invest $2 billion over the next 15 years to produce renewable natural gas, partnering with agriculture producers like Smithfield Foods and Vanguard Renewables, Leopold said.
The Virginia utility has also joined several other American Gas Association members on a low-carbon resource initiative, a five-year, $100 million research fund to develop green hydrogen and other low-carbon technologies. Dominion is preparing its own green hydrogen pilot project next year, too, with an ultimate goal of being able to accept 5% hydrogen in its system by 2030, Leopold added.
Expanding the use of those technologies, however, means cutting down the costs dramatically. It needs to become more economical to produce renewable natural gas in larger quantities, Leopold said.
For green hydrogen, the electrolysis process used to split water into hydrogen and oxygen molecules is pricey. Harbert noted that there’s an opportunity for the Department of Energy to ramp up its federal research funding on the technology and partner with industry to drive the costs down.
Overall, Leopold and Harbert both say the natural gas industry’s future shouldn’t shift much even if Democratic candidate Joe Biden is elected to the White House. Biden, as part of his revamped climate plans, has pledged to eliminate carbon emissions from the power sector by 2035, but he’s also emphatically said he won’t ban existing fracking.
The natural gas industry will continue to reduce its emissions voluntarily “regardless of the administration,” Leopold said. And Harbert argued the most “reasonable” climate targets include natural gas as part of the pathway to cut emissions.
“We look forward to sitting down with anybody in the White House, anybody in a statehouse, to help them understand the value proposition of natural gas and help them make the right decisions so that with us, they can achieve their goals faster, cheaper, and easier,” Harbert added.
