New Reports Show US Natural Gas Will Be Critical to the Success of Renewable Energy

According to two new reports, natural gas will be critical in transitioning to a clean energy future.

Research by consulting firm McKinsey & Company shows that natural gas has been – and will continue to be – vital to decarbonizing the US power supply while supporting renewables.

Meanwhile, think tank Ember provides evidence that countries like China are overwhelmingly turning to highly polluting coal because of recent shortfalls in renewable energy production, particularly with the decreasing reliability of hydropower.

Fortunately, the US has the resources and the know-how to decarbonize quickly. Since 1990, the US has decreased its CO2 emissions by 8% and can lead the way in helping the rest of the world achieve its climate goals.

By increasing the export of US natural gas abroad via LNG, we can expand a proven decarbonization solution that will smooth the ups and downs of energy reliability as we transition to a renewable future.

… natural gas is more reliable than renewables and helps to phase out the production of environmentally hazardous coal.

The benefits of clean natural gas vs coal

Some environmentalists argue that renewables alone are the only path towards cleaner energy. While the rapid expansion of renewables is a noteworthy success story, renewables have clear limitations, including battery storage and transmission infrastructure problems.

According to the McKinsey report, these challenges are causing renewables to produce only an "intermittent supply" of energy that cannot reliably match growing power demands.

To generate the same amount of electricity as natural gas, solar fields require 10 to 20 times more land, while onshore wind needs up to 200 times more. Overall, significantly more significant investments will have to be made in the power grid to support the rollout of renewables.

At the same time, natural gas is more nimble and can help phase out the production of environmentally hazardous coal.

According to the US Energy Information Administration (EIA), the use of natural gas in the electric power sector increased by more than 100% between 2005 and 2022, while coal declined by about 55%. This shift from coal to natural gas has contributed to an 18% reduction in energy-related CO2 emissions in the US since 2005.

This shift also reduced an estimated 532 million metric tons of CO2 over that same period, the most significant decarbonization lever to date, mitigating 10% of 2021 US GHG emissions. By comparison, renewable generation led to 248 million metric tons of CO2e (carbon dioxide equivalent) – less than half of what coal-to-gas switching produced.

With China being the world’s largest power producer, accounting for 31% of global generation, the environmental consequences of this rise in coal production will be devastating without a significant course correction.

Natural gas will power the transition to clean energy

The global decline in hydropower demonstrates precisely why natural gas must be a part of the solution for cleaner energy.

Research published by Ember found hydro generation, the largest electricity source among all renewables, fell by a historic 8.5% margin in the first half of 2023 due to adverse conditions. This decline was especially notable in China, which accounted for approximately 75% of the global decrease in hydropower.

China began significantly expanding coal production to make up for the energy deficit. According to the Ember report, China's increase in coal generation between January and June 2023 exceeded 203 terawatt-hours (TWh) compared to that same period in 2022. Natural gas generation increased by just 10 TWh, while hydropower declined by 129 TWh.

With China being the world's largest power producer, accounting for 31% of global generation, the environmental consequences of this rise in coal production will be devastating without a significant course correction. China emits the most energy-related CO2 emissions globally and could remain in that position through 2050 as it doubles down on coal power generation.

Natural gas should fill the deficit left by coal

Fortunately, natural gas provides the ideal solution – a cleaner and more reliable energy source that can make up for the deficit caused by the decline in global hydropower.

According to the EIA, natural gas emits almost 50% less CO2 than coal while producing equal energy. The recent progress in emissions reduction in the US through coal-to-gas switching shows that this is a proven solution that can succeed in other regions, too.

And the US's plentiful natural gas supply means we can lead this movement – securing cleaner, more reliable, and affordable energy for all.

Historic 17% decline in US greenhouse gas emissions would not have been possible without natural gas

The U.S. has been a global leader in lowering its greenhouse gas emissions for the past two decades. According to the EPA, U.S. greenhouse gas (GHG) emissions in 2021 were 17 percent below the 2005 level. While this statistic represents a remarkable national achievement, the factors that drove this historic reduction are poorly understood.

Many people mistakenly believe that the rapid growth of renewable energy sources - a noteworthy success story in its own right - is responsible for the decline in emissions. However, while renewables played an important role, we must recognize that the sheer scale of this decrease would not have been possible without natural gas.

While critics of natural gas defer to renewables as the only viable emissions solution, the truth is that the current state of battery storage and transmission infrastructure poses real obstacles to the buildout of renewables. Meanwhile, more power is generated globally with coal than any other fuel source. This persistence of coal, and its resulting emissions, will only continue if we adopt a renewables-or-bust approach.

But we can drastically slash emissions right now if we replace the dirtiest coal-fired power plants worldwide with natural gas. Gas burns far cleaner than coal and is more reliable than renewables, making it the best option to simultaneously achieve energy security, reliability, and emissions reductions. In fact, global power sector emissions would be reduced by 30% if the world’s top 5% worst emitting power plants switched to natural gas. Those emissions savings would increase to nearly 50% if that switch incorporated carbon capture and storage.

Source: United States Department of Energy Report to the President - January 2021

Natural Gas Was The Primary Driver to Lowering Emissions

The fact is that natural gas has been the key to lowering overall emissions in the U.S. since 2005. In total, 65% of all U.S. power generation emissions reductions from 2005-2019 were driven by switching from coal to gas. By contrast, renewables only accounted for roughly 30% during this period.

Energy Secretary Jennifer Granholm said natural gas “can play an important role as part of the clean energy transition” and that “pipeline and transmission capacity is critical to maintaining energy reliability, availability, and security.

Natural gas's reliability, availability, and low-carbon footprint have made it the ideal replacement for much dirtier coal as our underlying baseload fuel source. That is because natural gas is a very efficient energy source, producing the same power as coal while emitting 50% less CO₂.

Our expanding use of natural gas has advanced our clean energy goals and is helping ensure we can provide a stable and secure energy supply to the American people. This understanding led the U.S. Department of Energy to say in 2021 that "natural gas, which is quickly dispatchable, provides reliable, baseload power, serving as an important partner in continued renewable energy expansion."

Global Emissions Remain Stubbornly High

Unfortunately, the rest of the world is lagging in the energy transition. Due to global supply constraints and geopolitical instability, other large countries are failing to give up coal and reap the emissions reductions of natural gas. As a result, global coal consumption reached an all-time high in 2022.

While we have the model to reduce emissions, we need to adopt policies that allow us to lead the clean energy transition and bring this solution to the rest of the world. Without a plan to shift the world's energy away from coal, our contributions at home will fail to make a dent in a global crisis.

PAGE | Natural Allies CERAWeek Panel Discussion

Former Secretaries Ernest Moniz, Dan Brouillette, former Senator Mary Landrieu, and former Representative Tim Ryan emphasize the essential role that natural gas plays in the effort to simultaneously improve energy security and reduce emissions.