Natural Gas in a Low-Carbon Future: Challenges and Opportunities

IMGXYZ3034IMGZYXHigh oil prices and heightened safety concerns for nuclear energy in the aftermath of Japan’s crisis have put natural gas front and center in the energy picture. Carnegie hosted Robert Howarth of Cornell University, Roger Fernandez of the U.S. Environmental Protection Agency (EPA), and Fiji George of El Paso Corporation to discuss whether gas can play an essential role in fighting climate change and the challenges that need to be addressed to turn natural gas into a key component of building a low-carbon future. Carnegie’s Adnan Vatansever moderated.

New Focus on Shale Gas

Howarth shared results from his recent study on greenhouse gas emissions from shale gas, published in Climatic Change Letters.

• First Comprehensive Analysis: Given that his study is the first examination on shale gas emissions to be published in a peer-reviewed journal, Howarth argued that there is still significant room for improving the scope and robustness of the underlying data on this issue. To gather the most accurate picture of how shale gas emissions differ from coal or conventional gas, Howarth’s study used the best available data from a variety of sources, including Energy Information Administration, American Petroleum Institute, and Government Accountability Office reports.
   
• The “Achilles’ Heel” of Shale Gas: Methane, a far more potent greenhouse gas (GHG) than carbon dioxide, is the primary component of natural gas, and even small emissions leakage can have a significant global warming impact. The process of shale gas production presents numerous occasions for methane venting as well as inadvertent leakages, Howarth explained.  
   
• The Bottom Line: Comparing the GHG footprints of shale and conventional gas, Howarth focused on the gases that are created during production and processing activities. He found the footprint of shale gas to be greater than that of conventional gas or oil when viewed on any global warming time scale, but particularly on a twenty-year horizon. Compared to coal, he concluded that shale gas possesses a GHG footprint between 20 percent and 100 percent greater on a twenty-year time horizon, and roughly an equivalent footprint on a one hundred-year horizon.
   
• More Work Needed: Howarth pointed out that his study is intended to encourage further research and spark important discussion, and should not be seen as advocating for greater use of coal or oil. He argued that the GHG footprint of natural gas is set to gradually increase as conventional gas is replaced by shale and other unconventional sources, and that the ultimate goal is to reduce overall demand and transition to a future of renewable energy as quickly as possible.

Behind the Numbers

• Matters of Methodology: Within the scientific community, divergent data regarding methane’s role in natural gas emissions often results from disagreement over which global warming potential (GWP) multiplier should be used for methane, explained Howarth.  GWP is a means of expressing how specific greenhouse gases compare to one another. For example, carbon dioxide possesses a GWP of one while methane possesses a far more potent GWP of anywhere between 72 to 105 on a twenty-year horizon and between 21 to 33 on a one hundred-year horizon. The panelists noted that the time frame and concomitant GWP selected for a given study can significantly affect the final emissions numbers, and thus any set of GWP assumptions should be made readily apparent.
   
• Clarifying Major Changes: One source of controversy, explained George and Fernandez, was the dramatic jump in EPA estimates of methane emissions from natural gas systems between 2008 and 2009.  Fernandez stressed that the sudden increase—driven primarily by much higher estimated emissions from well venting and flaring—resulted from recent changes in EPA inventory methodology, and is not indicative of backsliding in natural gas industry practices.
   
• Mystery Emissions: George objected to any methodologies that treat “lost and unaccounted for” (LAUF) gas—essentially the gap between the quantity of gas going into a transport system and that coming out—as a direct proxy for GHG emissions. He countered that empirical studies, including those conducted by the EPA, have shown that LAUF is overwhelmingly associated with metering errors, not fugitive emissions.

Looking Forward

• Implementing Solutions: Many economically sound practices and technologies for reducing and recovering methane emissions exist, Fernandez noted, and their implementation on a broad scale could significantly improve the prospects of natural gas as a “bridge fuel” in the transition to a lower-carbon energy system. He suggested that government policies should incentivize industry adoption of these technologies, many of which pay for themselves relatively quickly.
   
• A Broader Context: George emphasized that any comparison of coal and natural gas should also include consideration of other criteria pollutants such as sulfur dioxide, nitrogen oxide, and mercury which are significant byproducts of coal production and utilization. These chemicals play a large role in local air pollution and environmental quality and, when they are taken into account, natural gas presents distinct advantages over coal. Both Fernandez and George also underscored the need to accurately assess GHG emissions from coal mining operations, as evidence suggests that small but consistent leakages may portend a higher GHG footprint for coal than is currently recognized.
   
• Better Data Ahead: All panelists expressed optimism about future improvements in natural gas emission data, with Fernandez pointing out that new mandatory GHG reporting rules will allow the EPA to begin collecting data from the entire oil and gas industry. In the future, policymakers will be able to rely on better activity data, better emission factors, and an enhanced survey of reduction activities underway.