Public Power - October 2008 - (Page 22)

The Future of Fuels in a Carbon-Constrained World scenario” of 24 percent). Gas burns then dropped to a tolerable 8 tcf. A comparison of these various scenarios shows the enormous variation in natural gas burns that could result from different mixes in the supply portfolio to meet cap-andtrade carbon regulation. Potential gas burns range from 4.0 tcf to 12.4 tcf. The largest influence on future gas burn will be the growth in electricity demand, and how much and how rapidly carbon capture and storage and nuclear can be added to replace gas and coal. It is important to emphasize that these scenarios were constructed without consideration of cost; they have not optimized, and are not necessarily even feasible. Rather, they intend to bring home the point that all five supply options will be in play simultaneously, and all five will be essential for meeting the impending carbon regulation without extreme imbalance. rence er Confe lar Pow So iego , San D & Expo -16 r 13 Octobe Stop by Booth # 1647 our boo th at: Offering an array of ﬁnancing alternatives for the commercial, municipal and federal energy management marketplaces. PROGRAMS: Power Purchase Agreements (PPAs) Lease, Lease Purchase & Loan Agreements Integrated Energy Services Agreements (ISAs) Build, Own, Operate and Maintain Agreements (BOOM) Federal ESPC and area wide Contracts Energy Performance Contracts (EPCs) For more information contact: Dick Rai, Manager Phone: 661-799-0440 Dick.Rai@NationalCity.com www.NC-4Energy.com al O Annu NAESC onica Santa M rence, Confe r 27-29 Octobe ou Stop by r booth at: The analysis makes a few critical points clear. First, load growth at the recent historical rate of 1.5 percent per year is simply not sustainable in the context of carbon regulation. The “scare” scenario projects truly frightening levels of gas burns (17 tcf) if it’s assumed load growth of 0.8 percent is replaced with 1.5 percent. Load growth makes a huge difference in the ability to achieve the carbon goals. Second, given the dominance of coal in the fuel mix, let alone the abundance of the U.S. coal resource base, development and implementation of carbon capture and storage becomes imperative. This reality argues that research and development of carbon capture and storage technology needs to be accelerated, and that all barriers to cost-effective commercialization need to be pulled out. Third, the solution portfolio probably needs to contain more renewables than assumed by EPA. Increasing renewables from the 13 percent of the portfolio used by EPA to the 20 percent level that we tested in several scenarios reduces the gas burn by 2 tcf and reduces emissions by approximately 200 million tons of carbon. Fourth, nuclear is poised for expansion with new Nuclear Regulatory Commissionapproved designs for advanced light water reactors, but many parties prefer to proceed cautiously with a nuclear renaissance. Our analysis shows that not having nuclear power means even more carbon capture and storage is necessary, and vice versa. The uncertainty surrounding the ability to rely on any or all five of these options is so great that none can be taken for granted. All require overcoming major technical and institutional hurdles in a carbon-constrained world. Removing or diminishing the prospects for any one of these options would create imbalance and strain on the other four, and particularly on the swing resource: natural gas. Reducing carbon emissions without placing an unrealistic burden on natural gas means we need as many tools as possible. T Catherine Elder is a senior director with R.W. Beck. This article is based on presentations she made last June at the APPA National Conference in New Orleans. 22 OCTOBER 2008 PUBLIC POWER http://www.NC-4Energy.com

Table of Contents Feed for the Digital Edition of Public Power - October 2008

Public Power - October 2008 Contents Perspective 10 Questions The Future of Fuels in a Carbon-Constrained World An Energy Revolution Energy Policy in 2009 and Beyond A Green Reincarnation Beyond the Green Bandwagon Reliability Green Energy Community Broadband Customer Service Hometown Connections Human Resources Parting Shot

Public Power - October 2008

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