Podcast Summary
The Complex Role of Natural Gas in a Deeply Decarbonized World: Natural gas, a versatile energy source, plays a significant role in our energy mix and emissions. Transitioning away from it poses challenges, especially in industry, and requires a nuanced understanding of various decarbonization pathways like electrification, hydrogen, carbon capture, and co-firing pipelines.
Natural gas plays a significant role in our energy mix and emissions, making its role in a deeply decarbonized world a complex issue. While some may advocate for eliminating natural gas as soon as possible, the reality is that it's not that simple. Natural gas is versatile, accounting for about a third of our primary energy production, and its uses are split across various sectors like power, industry, and buildings. Transitioning away from natural gas in the power sector, for instance, would only get us 38% of the way towards net zero emissions. Moreover, decarbonizing industry, which sometimes relies on natural gas for high-temperature processes, poses additional challenges. The conversation around natural gas decarbonization involves various pathways, such as electrification, hydrogen, carbon capture, and co-firing pipelines. Each approach comes with its own implications for infrastructure, land use, and grid demands. Despite the challenges, natural gas also presents an opportunity for innovators in the climate tech world to find replacements or decarbonize the existing infrastructure. The conversation around natural gas in a deeply decarbonized world is nuanced and requires a comprehensive understanding of its various uses and potential decarbonization pathways.
Natural gas's role as a bridge fuel challenged by upstream emissions and high global warming potential: Recent studies suggest natural gas's environmental impact could worsen as its upstream emissions and high global warming potential are addressed, making a zero-fossil-fuel future a complex issue
Natural gas, while used in various energy end uses, poses challenges in decarbonizing some sectors, particularly distributed uses like home heating. The biggest threat to natural gas's role as a bridge fuel isn't just its CO2 emissions when burned, but significant upstream emissions and the high global warming potential of natural gas itself. Recent studies suggest a 2.5% leak rate from wellhead to end use, which significantly increases the overall global warming impact of natural gas. This means that burning natural gas in homes could be even worse for the environment in the next 20 years compared to burning coal. While some may argue for a zero-fossil-fuel future, it's essential to consider the challenges of decarbonizing natural gas production and usage, as well as addressing the infrastructure and fundamental problems.
Natural gas faces an existential crisis due to methane emissions: Natural gas production and gathering account for 75% of methane emissions, while pipelines and end uses contribute the remaining 25%. Attention shifts to renewable energy, potentially leading to a 'natural gas death spiral'.
Natural gas faces an existential crisis due to upstream and midstream methane emissions, which are primarily responsible for methane leakage throughout the supply chain. These emissions, accounting for about 75% of the total, come from the production and gathering of natural gas. The remaining 25% comes from pipelines and end uses. The midstream and downstream elements of the natural gas supply chain may also contribute significantly to these emissions, requiring more study and monitoring. As attention turns to displacing natural gas with renewable energy sources, the potential for a "natural gas death spiral" looms. This scenario could see increasing adoption of renewable energy leading to declining demand for natural gas, resulting in higher prices and further incentivizing the shift away from natural gas. However, this outcome is not inevitable, and interim solutions may be necessary for the transition to a decarbonized energy system.
Solar energy's affordability spells trouble for natural gas infrastructure: The falling cost of solar is driving a transition away from natural gas, posing challenges for businesses and potentially leading to a death spiral for infrastructure
The increasing affordability of solar energy is leading to a potential death spiral for natural gas infrastructure. While rooftop solar has stalled out in cost compared to large-scale ground-mounted solar, it has paved the way for the integration of other distributed energy resources and electrification of various sectors. The falling cost of solar has made electricity the cheapest non-firm energy source globally, making the decarbonization of power supply and electrification of everything more plausible. However, this transition poses challenges for natural gas businesses, including declining market share, revenue loss, and rising perceived risk. These challenges can lead to a death spiral, where infrastructure owners need to raise unit prices to cover fixed costs with declining sales volume. While this might seem beneficial for decarbonization, it's not inherently so if economic alternatives for hard-to-replace sectors aren't available, leading to rising costs without significant emissions reduction for an extended period.
Decarbonizing Natural Gas: Two Options: To preserve optionality and existing natural gas infrastructure during decarbonization, consider either decarbonizing natural gas or repurposing infrastructure. Decarbonization methods include minimizing upstream methane leaks and carbon capture through pre- or post-combustion processes.
The energy transition towards renewable energy sources like wind and solar, supported by low-cost, long-duration storage, is the fundamental backbone of the decarbonization process. However, electrification alone may not be enough or practical for all consumers due to total cost concerns and reliability issues. Therefore, it's essential to preserve optionality and existing natural gas infrastructure during the decarbonization process. Two major options for this include continuing to use natural gas but decarbonizing it, or not using methane anymore but utilizing the infrastructure for something else or mothballing it entirely. To decarbonize natural gas, the first step is to address upstream methane emissions by minimizing leaks as much as possible. If natural gas is to play a long-term role in a decarbonized future, carbon must be removed from the methane. This can be done through pre-combustion carbon capture and removal, which results in hydrogen as a byproduct, or post-combustion carbon capture and sequestration. Pre-combustion carbon capture is less well-known but an interesting and worthwhile pathway to explore in the context of decarbonizing natural gas.
Two methods for zero-carbon hydrogen production: blue and turquoise: Blue hydrogen captures gaseous CO2, requiring significant infrastructure, while turquoise hydrogen produces solid carbon, which can be easily stored and potentially sold, making it more economically viable.
Both blue and turquoise hydrogen production methods can result in zero-carbon hydrogen, but they have different approaches to handling the byproduct carbon. Blue hydrogen involves capturing and transporting gaseous CO2, requiring significant infrastructure and coordination efforts. In contrast, turquoise hydrogen produces solid carbon, which can be easily stored and potentially sold for various uses, reducing the overall waste problem. Both methods require addressing upstream methane emissions. Renewable Natural Gas (RNG) is another approach to decarbonizing natural gas ecosystems. RNG is methane produced from biological sources, primarily from landfills and livestock. It can contribute to decarbonization efforts, but its current production capacity is limited. The solid carbon produced in turquoise hydrogen processes has potential value in various markets, making it a more economically viable option compared to blue hydrogen's infrastructure requirements.
Exploring Alternatives to Decarbonize Natural Gas: RNG production from various sources has limitations in scale and cost, and repurposing natural gas infrastructure for hydrogen is a challenging but credible way to decarbonize a significant portion of natural gas supply.
While Renewable Natural Gas (RNG) is a promising solution to decarbonize natural gas supply, it currently has limitations in terms of scale and cost. RNG can be produced from various sources like landfills, livestock, and biomass, but only a small fraction can replace the current natural gas demand. To increase the production, more complex technological pathways like gasifying cellulosic biomass are being explored. However, even this pathway is expensive and can't fully replace the methane we're using today. Another way to reduce natural gas usage is by repurposing existing infrastructure for hydrogen. This involves replacing some natural gas in pipelines with hydrogen, which requires significant retrofits to prepare the pipes for higher hydrogen blends and upgrading ancillary equipment. Hydrogen is a challenging gas to work with, and most pipelines today can only handle up to 20% hydrogen by volume, which is around 7% hydrogen by energy content. Old metal pipes need to be replaced with plastic pipes that can contain hydrogen. Despite these challenges, hydrogen is a credible way to decarbonize a significant chunk of natural gas supply.
Transitioning to hydrogen pipelines may be more feasible than blending hydrogen into existing pipelines: Building new hydrogen pipelines for transporting green hydrogen from remote renewable energy sources could be a cost-effective and efficient solution, but careful planning and investment are necessary.
Blending hydrogen into existing natural gas pipelines for widespread use at the end-user level may not be feasible due to the need for coordinated transitions and modifications at each industrial facility and end-user connected to the pipeline network. Instead, building new hydrogen pipelines specifically for hydrogen may be a more viable solution, especially for transporting green hydrogen from remote renewable energy sources. This approach could offer advantages in terms of cost, efficiency, and reducing reliance on electric transmission infrastructure for long-distance energy transport. However, the transition to hydrogen infrastructure will require careful planning and significant investment.
Cost-effective energy transportation via pipelines for hydrogen production: Pipelines are a cost-effective way to transport hydrogen from renewable energy sources to industrial demand centers, making hydrogen production economically viable in remote locations.
Pipelines are a more cost-effective way of moving energy compared to electric transmission lines, making it economically viable to produce hydrogen from renewable energy sources in remote locations and transport it to industrial demand centers via pipelines. The most easily electrifiable end use of natural gas is ground transportation, but industrial heat and building heating present significant challenges for full electrification due to increasing costs and efficiency drops at low temperatures. Thus, preserving a role for gaseous fuel delivery may be necessary to meet the remaining energy demands efficiently.
Natural Gas Role in Energy Transition: Natural gas will continue to be used for building heating, especially in a net zero world, and can be decarbonized through hydrogen pathways. End use resilience benefits from multiple energy delivery methods.
Natural gas will continue to play a significant role in the energy landscape, particularly in building heating, even in a deeply decarbonized world. Despite the trend towards electrification, some end uses, such as building heating, are proving to be more challenging to fully decarbonize. Natural gas infrastructure, which is abundant and already touches most end users in the country, can be utilized through decarbonization pathways like turquoise or blue hydrogen. The longest tail of natural gas use is expected to be in distribution-level end uses, primarily building heating. Natural gas may still be used for peak heating loads and resilience purposes in a net zero scenario. Additionally, having multiple ways of delivering energy to end users, both in the form of electricity and gas, provides valuable resilience. However, this means dealing with emissions elsewhere, likely through more carbon removal elsewhere in the system. Andy Loubershane, Senior Vice President of Research and Strategy at Energy Impact Partners, emphasized the importance of natural gas in the energy transition and the potential for decarbonization pathways like hydrogen.
Maintaining a Positive Attitude Towards Feedback: Even when faced with constructive criticism, it's crucial to keep a positive attitude and remain open-minded.
Even in the face of constructive criticism or playful jabs, it's important to maintain a positive attitude and keep an open mind. In the conversation, Shail Khan acknowledged Brian's humor, which she described as feeling like a parenting failure, but also expressed gratitude for the engagement. While they may not be able to respond to every piece of feedback, they do read and consider it all. This episode, featuring guest Brian Koppelman, is available for listening with links provided in the show notes or on canarymedia.com. The production team includes Daniel Waldorf and Steven Lacey, with theme music by Sean Marquand.