American Gas - May 2014 - (Page 8)

issues A Clean Air Plan d ig e s t The global market for home energy management systems will grow from $512 million in 2013 to $2.8 billion in 2020, forecasts navigant research in Boulder, colo., in a new report. The advent of smart thermostats-which allow users to manage their home energy systems remotely-is sparking a new wave of interest in these systems among consumers. "companies like comcast, ADT, Verizon, and AT&T have added energy management as an option that can be bundled with home security, automation, or internet access," said neil strother, senior research analyst with navigant, in a statement. "These service providers are seeding a market that has reasonable potential over the next several years." natural gas has become the fuel of choice for several large companies with vehicle fleets, including UPs, Waste management, and Frito-Lay. now, smaller firms also are adding CNG trucks to their operations, reports The Houston Chronicle. "The fact that it's $2 a gallon cheaper makes it a no-brainer," mike Little, director of transportation of mid south Baking in Bryan, Texas, told the newspaper. Other companies in the Houston area that have recently made the switch to cnG include newTexPlumbing, Apple Towing, and Lodge Lumber. Continued on page 10 8 AmericAn GAs may 2014 Meeting new EPA regulations through gas-fired plants c lean Air Task Force, an environmental nonprofit, is promoting a plan to help states meet forthcoming EPA regulations by switching power generation from the highestemitting coal plants to underused gas-fired stations. In June 2013 President Obama directed the EPA to propose national standards to lower carbon emissions that states could meet by adopting their own plans. Those standards are slated to be proposed by June 2014, with the final rules issued by June 2015. CATF found that shifting power generation to existing gas plants from the highest-emitting coal fleets was enough to achieve a 27 percent drop, compared to 2005 levels, in power-related carbon dioxide by 2020. Under this scenario, electricity costs "would rise by less than 2 percent," Conrad Schneider, CATF advocacy director, told American Gas. "The result would be no net increase in monthly bills" to end users. CATF holds that the most cost-effective way to meet the standards would be for the EPA to set a total for the amount of carbon that states could release into the atmosphere. States could then trade emissions credits. The CATF says its program would offer an alternative to the Northeast's Regional Greenhouse Gas Initiative and California's carbon-trading program. "Inefficient coal plants and underutilized gas plants are distributed across the country, so this displacement is possible in every region," Schneider said. "But how cost-effective it is to replace coal with gas, and how much underused gas capacity is available, varies by region." The greatest opportunities for displacing coal with gas are in the East-Central and Southeast regions, according to CATF's findings. The Great Plains, on the other hand, has the least underutilized gas capacity, "so they may need to purchase credits from the Southeast," Schneider said. The Natural Resources Defense Council has proposed its own plan for meeting the forthcoming EPA regulations. Originally issued in 2012, the plan was updated in March. NRDC suggests that instead of forcing plants to reduce emissions or shut down, states should be allowed to make cuts across their energy systems to comply with overall emissions limits set by the EPA. Those cuts could be achieved through measures such as smart-grid technologies, buildingefficiency efforts, and cleaner energy sources such as gas and solar. -Eric Schoeniger issues Looking to 2016 Will enough gas plants be in place when new EPA rules take effect? A s new EPA Mercury and Air Toxic Standards go into effect by 2016, a growing number of coal-fired power plants will be shuttered. In fact, according to the U.S. Energy Information Administration, 60 GW of coal generation will come offline by 2020-90 percent of it in 2016. The new standards set thresholds for mercury, sulfur dioxide, acid gases, and other emissions. For many plant operators, the most cost-effective solution will be to shut down their coal plants and replace them with gas-fired generation. With the deadline less than two years away, will the industry be ready? "These new rules aren't a surprise, so most industry participants have been preparing," Mark Klan, associate director for Navigant Research, told American Gas. What's more, "many gasfired plants operate at low load factors," he said. "Some increased capacity needs can be met by running existing gas plants harder." But that won't be true in every part of the country. "There are already some constraints in the marketplace, because there hasn't been

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American Gas - May 2014