Baker is right; we need gas pipeline

Renewables-only approach won’t work

Gov. Charlie Baker is right to push for a new natural gas pipeline. His support for renewable energy – solar and wind – is fully compatible with his support for more natural gas.  They are two halves of the same energy foundation supporting a structure that is both more affordable and better for the environment.

Those who oppose his position on natural gas might look at the success Texas is having integrating into its electric grid intermittent renewable resources – wind and solar – with greater use of natural gas.

The Wall Street Journal reported August 29 on the rapid growth of wind energy in Texas since 2001.  Today, it accounts for 16 percent of Texas’ electric power generation, up from just 2 percent in 2001.  It also reports that Texas is anticipating a “huge surge” in solar capacity.

What does this have to do with natural gas?

According to the US Energy Information Administration, natural gas electricity generation in Texas increased 20 percent over the past five years. Natural gas now generates about 48 percent of electricity in Texas – as it does in New England — while generation from coal-fired plants has fallen nearly 25 percent.

Texas, like California, is successfully integrating traditional electric power generation with intermittent renewable generation.  As a result, energy markets are more competitive, price volatility has been reduced, emission levels have declined, and reliability of service is assured.

In New England, affordability and reliability have become secondary issues for many as virtually every infrastructure project faces strong and growing opposition.  Whether it’s an electric transmission line needed to deliver wind energy or hydroelectric power; a wind generation project on mountaintops in Maine, New Hampshire, and Vermont; or natural gas pipelines in almost any location, opposition often overshadows need and value, both in economic and environmental terms.

Juxtapose New England’s apparent move toward a renewables-only approach with events elsewhere and one might experience a head-scratching moment.  Consider a recent Wall Street Journal story on General Electric, which the newspaper described as “bullish about coal again.” It noted that GE is “poised to build coal plants in developing countries’ economies…where demand for power is growing quickly and other sources of fuel are unavailable or too costly.” GE doesn’t appear to be ignoring environmental concerns, however.  On the contrary, consider its announcement, reported in the Boston Globe August 30, that it is “joining an energy research program at the Massachusetts Institute of Technology with the goal of tapping new thinking on cutting carbon emissions and replacing fossil fuels….”

A week earlier, the Washington Post reported on “a surprisingly tight relationship between renewables on the one hand, and (natural) gas on the other.”  The Post story was on a National Bureau of Economic Research assessment of experience in 26 countries that found “a 1 percent increase in the share of fast-reacting fossil technologies is associated with a 0.88 percent increase in renewable generation in the long term.”

One takeaway from these stories is that around the world, projects that would be unthinkable in New England are essential to developing economies as leaders seek for their citizens the benefits of affordable and reliable energy, benefits we often take for granted.  Another is that the energy industry is making great inroads in pursing cleaner technologies, just as GE is doing even with coal as it works to improve efficiency and reduce emissions while at the same time staking out a leadership role in energy efficiency and renewables.

Meet the Author

Carl Gustin

Consultant, New England Coalition for Affordable Energy
Texas’ experience, the NBER findings, and GE’s all-resource business strategy are reminders that renewable energy and energy from more traditional power plants are not incompatible with economic and environmental goals.  In fact, weakening one half of the foundation ultimately will weaken the other.  Gov. Baker gets that and it is reflected in his all-resource, “combo platter” approach to energy policy.

Carl Gustin is a consultant to the New England Coalition for Affordable Energy, which includes many of New England’s major business and industry organizations and labor representatives.

  • NortheasternEE

    The success of wind energy in Texas is an exaggeration. For a more realistic assessment read this report:

    http://comptroller.texas.gov/specialrpt/electricity/96-1767.pdf

    The only reason we need more gas is that the mandated prospect of adding wind and solar is killing coal and nuclear. Adding more gas to backup valueless wind and solar will leave us 100% dependent on the supply of natural gas for heat and electricity. As for pollution, the loss of nuclear cannot be replaced by wind and solar without increasing GHG emissions from leaking gas lines.

    There is no such thing as an affordable renewable energy economy. Skyrocketing rates, and flickering lights from unreliable wind and solar is all we are going to get.

    And, that is the real lesson from Texas!

    • Jan Galkowski

      As usual, NortheasternEE is singing the song of big energy, both fossil fuel and nuclear. Indeed, the demise of the Pilgrim Nuclear power planet is largely because of the 59% electrical generation in Massachusetts by natural gas. Simply because NortheasternEE, and the author of the article, who repeatedly cites from sources like the _Wall_ _Street_ _Journal_, whose official editorial opinion doubts the reality of climate change, and is at odds with editorial opinions of other major financial periodicals like _The_ _Economist_ or _The_ _Financial_ _Times_, cannot imagine how renewables can power Massachusetts in tandem with demand response, a smart grid, and a crash installation of energy storage, does not mean their imaginations are in consort with reality. The only real constraints on these futures is the unwillingness of the major utilities to go along with them. Indeed, the only reason why electricity prices are high in Massachusetts is because the Commonwealth’s citizens _use_ _less_ _electricity_ and, so, the incredibly high burdens and overheads from pursuing silly projects like additional pipelines are spread over fewer kilowatt hours. You’ll see the same pattern in other states.

      All the author and NortheasternEE are saying is that the companies they represent (I wonder who they include?) don’t know how to fix this problem without doing things the _same_ _old_ _way_. Accordingly, they should be relegated to the dustheap of failed business, and step aside, leaving the future to more nimble advocates and businesspeople.

      This is why the state government should open the marketplace to the competition of microgrids and, increasingly, regions of the state which are independent of the grid. Dennis-Yarmouth Regional High School and their area tried to do that, and Eversource complained about it bitterly. No grid, and no state government can dictate that a business can’t generate its own electricity for itself. After all, that’s what emergency generators are all about. What they _do_ regular is competition with utilities …. Individual generators like that cannot presently become utilities. That should be changed, because articles like those by Mr Gustin and comments like those by NortheasternEE, show that existing utilities simply don’t know how to do it, and are using their regulatory capture of the Baker administration and its DPU to remain profitable.

  • Mhmjjj2012

    Does anyone know what’s going on with the Federal Energy Regulatory Commission’s docket on ISO – New England’s formula rates that FERC called “unjust and unreasonable…because they lack sufficient detail to determine how certain costs are derived and recovered?” ISO – New England is the nonprofit running our electricity grid, overseeing the “most lucrative” billion dollar plus wholesale electricity market, paying its CEO $2,000,000 a year and giving board members $100,000+ for attending meetings.

  • Jan Galkowski

    Mr Gustin’s depiction of the electricity generation situation in Massachusetts and Texas is misleading at best, and, judging by the actual numbers at the U.S. Energy Information Administration (see http://www.eia.gov/electricity/data/state/generation_monthly.xlsx), consists of cherry-picking from sources and years which make his case. Of course, that does not depict reality.

    Let’s take Texas, for example. Their electrical energy needs in 2015 were 14 times larger than Massachusetts. They got 10% of their energy from wind, and a miniscule amount of their energy from solar (0.09%). They got 53% of their energy from natural gas and 9% from nuclear. Yet despite their large contribution from wind and large commitment to natural gas, over 2015, there was little correlation between use of natural gas and availability of wind (-0.3). That means, no, there is no offsetting of energy with natural gas when winds don’t blow. Clearly the Wall Street Journal article was incorrect in its 16% of energy claim. And while Texas might be expecting a “huge surge in solar capacity”, that’s because it presently has none, so of course if you start from a baseline of near zero, it seems like a lot. And one wonders what that false emphasis means about the perspective and motivations of the author.

    In fact, in 2015 and in contrast and despite the difference in latitude and weather, Massachusetts got a full 2% of its energy from solar In fact, in 2015 it got THREE TIMES as much energy from solar as from wind, despite all the ballyhooing about offshore wind and onshore turbines. Since 2014, the amount of electrical energy Massachusetts generated from solar HAS DOUBLED. In the first 6 months of 2016, not the sunniest season, it STILL got 2% of its electricity from solar. Wind generation remained flat from 2014 to 2015, at 0.7%.

    And what of the offsetting of nuclear and coal with renewable energy in Massachusetts? Compared to Texas, we don’t have any to speak of. Surely, there is no evidence that even the doubling of solar caused the decrease of Massachusetts electrical generation by nuclear from 18% to 15% and by coal from 9% to 7%. In fact it is mathematically impossible that renewables affected nuclear and coal generation AT ALL. In contrast, ELECTRICAL GENERATION USING NATURAL GAS INCREASED FROM 58% IN 2014 TO 64% IN 2015. There’s your nuclear- and coal-killer.

    And it is no wonder that GE is not a leader in renewable energy generation, at least not any longer. That field is dominated by Vestas, Siemens, Alstom Wind, Hitachi, and the surging Chinese producers CNR, CSIC, and Ming Yang. Placing bets on goal, against the outlooks of financial scholars like Bloomberg, is foolhardy, especially if, as Mark Carney, Bank of England governor suggests, these assets are likely to be stranded by regulation and insurance costs. If the op-ed is correct — and there’s plenty of evidence in its sloppy use of numbers elsewhere that it is not — GE may be turning to “clean coal” because it does not know how to compete in any other market.

    The citizens of the Commonwealth ought not to be fooled. Companies deeply invested in fossil fuels are terrified that their markets and industries will encounter “Minsky moments”, causing their assets and prices to suddenly plummet. Why else, despite natural gas stranglehold on electrical generation in Massachusetts to a full 64% are the utilities and those companies crying “the sky is falling” as is Mr Gustin? Building generation and pipelines is for them an existential struggle, and they are trying to force governments to do “sunk cost buy-ins” of their assets so that, no matter what disasters unfold, those governments will be stuck with their long term investments. They are, despite their pleas, no friends to renewable energy, they are no “bridges to the future”. Their business plans do not have any depreciation schedules or phase-out timetables. They want continued revenues.

  • Jan Galkowski

    Hah! Guess my comment was too hot for Mr Gustin!

  • NortheasternEE

    The problem with renewable energy in Texas is real.

    So, is the problem with wind power in Scotland.

    http://euanmearns.com/scotland-gagging-on-wind-power/

    Germany, who killed nuclear out of fear, is back to using coal.

    https://www.youtube.com/watch?v=IxiUVyPRfxw

    Technical barriers to the success of intermittent, variable, and unpredictable power from wind is not going to yield to the imagination of technical amateurs currently governing from Beacon Hill. Vermont Yankee and Pilgrim are not closing just because natural gas is cheap today. They are closing because state and regional mandates for unreliable renewable energy are carving out more than half of their future market for wind and solar. Without natural gas these market carve outs are technically impossible. So, Baker says build the pipeline and add the cost to the electric bills.

    If coal and nuclear were just succumbing to lower natural gas pricing, our rates would be going down. Our rates are going up, and up, and if nuclear is forced out of the market, GHG emissions will increase, blackouts will become common, and rates will skyrocket.

  • Paul Lauenstein

    Charlie Baker’s support for expansion of gas infrastructure is not in the best interests of the citizens of Massachusetts. The study by the Attorney General last fall determined that energy efficiency and demand response are less expensive means of meeting our energy needs. See: http://www.mass.gov/ago/doing-business-in-massachusetts/energy-and-utilities/regional-electric-reliability-options-study.html. Furthermore, the Global Warming Solutions Act requires a whopping 80% reduction in greenhouse gas emissions by 2050. That imperative cannot be achieved while expanding gas infrastructure. Instead, the Baker administration should require gas companies to promptly repair over 20,000 gas leaks in Massachusetts that are spewing methane, a highly potent greenhouse gas, into the atmosphere every day.

    The economic vitality of Massachusetts is linked to that of Boston, a low-lying coastal city that is vulnerable to sea level rise (the average water level in Boston Harbor has already risen almost a foot). In this context, expanding fossil fuel infrastructure is shear madness.