White House Chronicle

News Analysis With a Sense of Humor

Cooperative Utility Lighting Way to a Carbon-Free Future

Electric power lines and pylons against a blue sky with clouds.

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A Western rural electric cooperative is shining a light on the utility industry’s future and how it will tackle climate change.

Tri-State Generation and Transmission Association, in Westminster, Colo., a wholesale power supplier to 42 member co-ops in four states, has filed a visionary Electric Resource Plan as required by Colorado law. It is a document that lifts the veil on the future for Tri-State and where the entire utility industry is going.

According to the plan, Tri-State will add two advances to its system:

—It will deploy 100-hour iron-air batteries to smooth the variability of wind and solar.

—It will build natural gas capacity, adding carbon capture and storage within three years of construction in 2028.

These two actions will bring to earth dreams and schemes pursued by the electricity industry for two decades. It is the dawning of a new environmentally driven age in electricity.

Iron-air technology recasts solar and wind generation, adding resilience and balancing their intermittency. Lithium-ion batteries used by utilities are limited in their drawdown time to two to four hours. It is hoped iron-air will go a long way toward stabilizing utility systems. Predictions are that it will be cheaper.

In the same way, carbon capture and storage has been a long-term goal. If it can be demonstrated to be mature enough to be added to a utility system, the nation’s abundant natural gas — favored by utilities — can remain part of the fuel mix.

Under the plan, Tri-State envisions closing coal facilities and switching to more renewables, including its continued advancement of solar, with plans for installing 240 megawatts of new solar, for a total of 920 megawatts of solar by 2031, and buying more wind power.

Tri-State says it is committed to emissions reductions, with modest, new natural gas resources to support reliability.

Some environmentalists oppose natural gas — to its production, transportation, domestic use and export. Without it, coal will be burned in the United States and abroad.

The anti-natural gas forces represent a challenge for the Biden administration as they would like to get the nation out of the gas business altogether.

Just before Christmas, Sunrise Movement invited me to join them in urging President Biden to veto a big Louisiana liquified natural gas (LNG) export project. The project, called CP2, would make the United States an even more fearsome player in the world LNG market. It would allow the nation to offset Russian gas dominance in many countries. It would also counter the power of gas exporters like Saudi Arabia, Qatar and the United Arab Emirates, increasing their gas exploration. 

At some point, gas will flow from fields off Israel and Lebanon in the eastern Mediterranean.

It also may help countries switch from burning coal to natural gas, a far cleaner fuel.

Yet Sunrise, an association of young people promoting the Green New Deal, said,“It would poison communities and be a disaster for the climate: experts say that it is the equivalent of building 52 new coal-fired power plants.”

We have seen this kind of one-factor analysis from pressure-group environmentalists before.

Take the environmental communities’ universal and pathological opposition to nuclear power. It began in the late 1960s and accelerated until global warming began, slowly, to change minds.

Sixties environmentalists, who had a determination to destroy the nuclear fuel option, favored coal. Now that coal has been identified as a climate change culprit, the alternatives are wind and solar.

Natural gas — which, according to the Energy Information Administration, emits slightly less than half the pollutants of coal for a kilowatt-hour of electricity production — is in the environmentalists’ sights.

Unfortunately, the rigidity of their approach doesn’t allow for the huge changes that are taking place in the electric utility industry, as seen at Tri-State with its commitment to renewables, emissions reductions and a resilient system.

The Ghost of Jimmy Carter Haunts Natural Gas Decisions

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The ghost of Jimmy Carter may be stalking energy policy in the White House and the Department of Energy.

In the Carter years, the struggle was for nuclear power. Today, it is for natural gas and America’s booming liquefied natural gas future.

The decisions that Carter took during his presidency are still felt. Carter believed that nuclear energy was the resource of last resort. Although he didn’t overtly oppose it, he did damn it with faint praise. Carter and the environmental movement of the time advocated for coal.

The first secretary of energy, James Schlesinger, a close friend of mine, struggled to keep nuclear alive. But he had to accept the reprocessing ban and the cancellation of the fast breeder reactor program with a demonstration reactor in Clinch River, Tennessee. Breeder reactors are a way of burning nuclear waste.

More important, Carter, a nuclear engineer, believed the reprocessing of nuclear fuel — then an established expectation — would lead to global proliferation. He thought if we put a stop to reprocessing at home, it would curtail proliferation abroad. Reprocessing saves up to 97 percent of the uranium that hasn’t been burned up the first time, but the downside is that it frees bomb-grade plutonium.

Rather than chastening the world, Carter essentially broke the world monopoly on nuclear energy enjoyed — outside of the Soviet bloc — by the United States. Going forward, we weren’t seen as a reliable supplier.

Now, the Biden administration is weighing a move that will curtail the growth in natural gas exports, costing untold wealth to America and weakening its position as a stable, global supplier of liquified natural gas. It is a commodity in great demand in Europe and Asia and pits the United States against Russia as a supplier.

What it won’t do is curtail so much as 1 cubic foot of gas consumption anywhere outside of the United States.

The argument against gas is that it is a fossil fuel and fossil fuels contribute to global warming. But gas is the most benign of the fossil fuels, and it beats burning coal or oil hands down. Also, technology is on the way to capture the carbon in natural gas at the point of use.

But some environmentalists — duplicating the folly of environmentalism in the Carter administration — are out to frustrate the production, transport and export of LNG in the belief that this will help save the environment.

The issue the White House and the Energy Department are debating is whether the department should permit a large, proposed LNG export terminal in Louisiana at Calcasieu Pass, known as CP2, and 16 other applications for LNG export terminals.

The recent history of U.S. natural gas and LNG has been an industrial and scientific success: a very American story of can-do.

At a press conference in 1977, the then-deputy secretary of energy, Jack O’Leary, declared natural gas to be a depleted resource. He told a reporter not to ask about it anymore because it wasn’t in play.

Deregulation and technology, much of it developed by the U.S. government in conjunction with visionary George Mitchell and his company, Mitchell Energy, upended that. The drilling of horizontal wells using 3D seismic data, a new drill bit, and better fracking with an improved fracking liquid changed everything. Add to that a better turbine, developed from aircraft engines, and a new age of gas abundance arrived.

Now, the United States is the largest exporter of LNG, and it has become an important tool in U.S. diplomacy. It was American LNG that was rushed to Europe to replace Russian gas after Russia’s invasion of Ukraine.

In conversations with European gas companies, I am told they look to the United States for market stability and reliability.

Globally, gas is a replacement fuel for coal, sometimes oil, and it is essential for warming homes in Europe. There is no alternative.

The idea of curbing LNG exports, advanced by the left wing of the Democratic Party and their environmental allies, won’t keep greenhouse gases from the environment. It will simply hand the market to other producers like Qatar and the United Arab Emirates.

To take up arms against yourself, Carter-like, is a flawed strategy.

Step on the Gas, Europeans Plead

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To hear Brenda Shaffer, a peripatetic academic specializing in European and Eurasian energy issues, currently on a research fellowship at Georgetown University, natural gas is the predominant fuel of the 21st century, and it will be used copiously as time goes on. It will become the fuel of transportation as well as heating, manufacturing and electric generation.

But, at this point in time, moving natural gas from supplier to user presents special problems. It is not as easily transported as oil, and it is not as fungible.

Ideally, natural gas is transported by pipeline. Less desirably, it is converted into a liquid at -260 F and shipped around the world, where it has to be regassified. The freezing and the regassification processes for liquefied natural gas (LNG) require hugely expensive plants: over $5 billion at the originating end, and half that at the receiving end. This makes the gas expensive and its shipment inflexible.

Oil is put on tankers and unloaded wherever it is needed. LNG is shipped in special cryogenic tankers to dedicated terminals on long-term, take-or-pay contracts.

The United States is in the middle of a natural gas boom of unprecedented proportions; the result of extraordinary reserves in shale and the development of sophisticated hydraulic fracturing (fracking) technology linked to horizontal drilling. The pressure to export is on, balanced by environmental concerns and the fear of manufacturers tat the price will rise.

In the current crisis over Ukraine, a question has arisen as to whether we can help our European allies by shipping them LNG. The answer is “yes and no.”

We do not have any terminals ready to begin exports; the first LNG exports will be loaded from the Sabine Pass terminal in Louisiana late next year and will be shipped to Asia. Nor does Europe have enough receiving terminals.

But the Europeans argue strongly that the mere presence of the United States as a player in the natural gas export business will have a huge impact on the world market, signaling that we are on the way and, hopefully, warning Russia that its captive gas customers in eastern and central Europe are looking at alternatives, and want to lift the yoke of dependence on Russia.

With the invasion of parts of Ukraine by Russian troops or their surrogates, gas has become a weapon of war. Russia's giant, state-owned gas monopoly, Gazprom, has been an arbitrary supplier to Europe for years. Most troublesome is that the bulk of Europe's gas supplies transit Ukraine, and that Gazprom has never behaved like anything but an arm of the Kremlin, dangerous and capricious.

In 2009, Gazprom cut off supplies over alleged contract and payment issues; in the cold of winter, the Russian bear was merciless. Also, it posts a different gas price for each customer, regardless the distance from Russia's border or cost of delivery.

Desperately, Europe is looking for a defense against Russia freezing supply to Ukraine this winter and cutting off some countries, particularly those wholly dependent on Russian gas, like the Baltic states and Slovakia.

That is why the Visegrad Group, consisting of Poland, the Czech Republic and Slovakia, under the chairmanship of Hungary, has been intensively lobbying Congress to pass a bill that would simplify and speed up the licensing of export terminals in the United States. At present, seven terminals have provisional licenses from the Department of Energy, and Sabine Pass is fully licensed.

Visegrad members swarmed Capitol Hill this week, lobbying for the legislation. They were accompanied by officials from Bulgaria, Croatia, Latvia, Romania and Ukraine.

Their message was simple: the legislation would convince the Russians that they had to play by market rules because the entry of the United States as a player in the world of LNG — even if the gas cannot be offloaded in Europe in the near future — will send a strong market-stabilizing message.

Where possible, eastern and central European countries are improving their interconnections and adjusting their systems so they can reverse the flow of gas to help Ukraine in a dire emergency. But no one believes that it will make enough of a difference; besides, as most of that gas will have originated in Russia, some Russian contracts specify the use of the gas.

Almost all of the gas in the region is used for heating rather than electric generation or manufacturing. Central and eastern Europe is dreading winter and imploring the United States to send strong signals, even if it will be a long time before Pennsylvania or Ohio gas warms the people of Ukraine and its neighbors. — For the Hearst-New York Times Syndicate

 

Europe and Its Slippery Energy Slope

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BRATISLAVA, Slovakia — Europe, at present the world's largest market and largest economic bloc, is decline and living standards are in danger. That was the sober message at an energy conference here, delivered by a battery of speakers from across eastern Europe.
 
The narrative is that energy is what is dragging Europe down – not low birthrates and pervasive social-safety networks, but increasing dependence on expensive energy imports and hopelessly tangled markets.
 
Although delegates gathered to discuss the particular problems of eastern Europe, many had comments about the energy dependence across Europe; its labyrinthine regulations in nearly all 28 countries, its inability to form capital for large projects like nuclear, and governments intruding into the market.
 
The result is a patchwork of contradictions, counterproductive regulations, political fiats and multiple objectives that leave Europeans paying more for energy than they need to and failing to develop indigenous sources, such as their own shale gas deposits in Ukraine and Poland. It also leaves countries dependent on capricious and expensive gas from Russia, unsure of whether they can build needed electric generating plant in the future and poorly interconnected, sometimes by both gas pipelines and electric lines.
 
Good intentions have also had their impact. The European Commission has pushed renewable energy and subsidized these at the cost of others. The result is imperfect markets and, more important, imperfectly engineered systems.
 
Germany and other countries are dealing with what is called “loop flow” – when the renewables aren't performing, either because the wind has dropped or the sun has set, fossil fuels plant has to be activated. This means that renewable systems are often shadowed by old-fashioned gas and coal generation that has to be built, but which isn't counted toward the cost of the renewable generation.
 
With increasing use of wind, which is the most advanced renewable, the problem of loop flow is increased, pushing up the price of electricity. Germany is badly affected and the problem is getting worse because it heavily committed to wind after abandoning nuclear, following the Fukusima-Daiichi accident in Japan.
 
Frank Umbach, associate director of the European Center for Energy and Resource Security at King's College, London, said energy costs in Germany are now driving manufacturing out of the country and to the United States.
 
Umbach said that as Britain de-industrialized 15 years ago, Germany was beginning to go the same way. He said Britain had been able to sustain itself through financial services and other service sector jobs, but that was not a prospect for Germany, the industrial mainstay of the European Union. Now Britain, with its new nuclear policy, is trying to re-industrialize, he said.
 
Umbach urged that Europe get serious about shale gas and even burning coal. His argument was that there are environment safeguards available and that more are being developed, such as the new less environmentally assaulting techniques in hydraulic fracturing (fracking) used to extract tightly bound natural gas from shale formations.
 
Several speakers said the region has to face the reality that it is no longer able to generate the capital it needs for liquefied natural gas terminals, nuclear power plants and unconventional gas recovery in Ukraine, Poland and in the Black Sea offshore Romania and Bulgaria.
 
Many countries, particularly in eastern Europe, still balk at foreign ownership of their energy infrastructure and have actively driven away investment. Poland, for example, has frightened off shale gas developers from the United States by insisting that as the resource is developed, 50 percent of the developing company must be ceded to the state. The companies left.
 
In other places, the Czech Republic, for example, landowners have no claim to the resource under their land; that remains the property of the government and, therefore, they are hostile to any development on their property, whether it is for oil, gas or minerals.
The United Kingdom, by contrast, declared a spokesman for its energy ministry, Hergen Haye, is open for business. That means if the Americans, the Chinese of the Middle Easterners want to “buy into” Britain's new nuclear undertaking, “they are welcome.”
 
Europe's sad energy situation was summed up by Iana Dreyer of the EU Institute for Security Studies. She said Europe is still the largest trading bloc in the world, the largest economic machine and the largest market, but that it is slipping. By 2030, she calculated, Europe will have slipped to No. 3, behind the China and the United States, unless it can untangle its energy Gordian knot.
 
Europeans here cite the United States as the way to go in energy. It makes a body feel good. — For the Hearst-New York Times Syndicate