Why natural gas will thrive in the age of renewables

In 2015, Hawaii’s state government signed into law a bold vision for the island’s energy future, pledging to generate 100 percent of its power from renewables, such as wind and solar power, by 2045. Hawaii’s steady trade winds and warm sunshine seemed to make it the perfect place to pursue a clean energy mix. Already, there are days when Hawaii generates nearly 60 percent of its electricity from renewables.

Shifting to wind, solar and other alternative fuels is an ambition shared by many state leaders across the U.S. as the country tries to grapple with shifting consumer demand, climate change and uncertain political realities. Both California and New York, for example, are aiming to reach 50 percent renewable power by 2030. But this transition can’t be achieved simply through policy preferences and good intentions; it presents serious technological, financial and logistical challenges.

Meanwhile, U.S. energy demand is expected to increase by about 13 percent by 2050. Given these realities, complete dependence on renewables may be out of reach. Even decades into the future, utilities will remain reliant on a mix of resources, including natural gas, to achieve a sustainable energy landscape.

Intermittency is the fundamental challenge of wind and solar energy. Utilities struggle with the inherent peaks and valleys that come with renewables since power grids were originally designed for a steady supply coming from traditional baseload power plants. One obvious example: there is currently no large-scale, cost-effective way to store solar energy during the day for distribution at night.

“The biggest challenge of renewables is their intermittent nature,” said Don Santa, president and CEO of the Interstate Natural Gas Association of America. “Consumers large and small need and expect a steady and reliable source of electricity.”

Another issue is that large-scale wind and solar renewable projects can take up huge amounts of land. The nearly 400-megawatt Ivanpah Solar Electric Generating System in California spans 4,000 acres, for example. The potential impact of a large footprint on animals and ecosystems can make it difficult for renewable developments to get the necessary permits from environmental regulators. Fossil fuel power generation projects also face this problem, but the issue is different for them given the smaller amount of acreage they typically require.

Ever-improving technology does offer hope for addressing these challenges in the coming decades.

“Look back 100 years, see what was driving energy then—coal and wood—and think about how drastically things have changed,” said Wayne Winegarden, senior fellow in business and economics at the Pacific Research Institute. “Now look forward 100 years. Technology is sure to evolve, maybe providing solutions we haven’t even thought of yet.”

One area that’s been given significant attention is new battery technology that could store energy for later use. But while high-capacity, low-cost batteries may one day enable more solar and wind supply, uncovering that innovation will take billions more in R&D costs in the hopes of achieving that breakthrough. In addition, significant investment would be needed in minerals, other inputs and production capacity to manufacture the needed supply. Even if battery storage cost drops by two-thirds by 2030, the manufacture of grid-scale batteries could take many years to integrate that technology into our power grid.

There is one sphere of innovation, however, that has already proven to be transformative—the expansion of domestic natural gas production and consumption.

Natural gas burns much cleaner than coal and offers a stable energy supply that utilities can use in conjunction with solar and wind power. “The United States has an abundance of affordable natural gas, it has a robust and well-developed pipeline infrastructure in place and gas-fired turbines can ramp up quickly to meet spikes in demand,” Santa said. “It has a valuable role to play as a complement to renewables, matching up very well as a backstop to their inherent intermittency.”

These days natural gas currently accounts for 33 percent of American electricity generation and that’s predicted to rise steadily in the coming years, partly because of a decline in coal use.

The transition is a boon for the environment. U.S. power plant CO2 emissions could drop as much as 30 percent by 2030 from their 2005 levels if states meet their emissions goals. One crucial factor: new natural gas plants emit 50 to 60 percent less carbon into the atmosphere than new coal facilities. In the longer run, it may be possible through carbon capture technology to completely decarbonize natural gas, allowing continued use of this abundant energy source. It's a possible next step. Estimates from the Intergovernmental Panel on Climate Change suggest reducing global emissions to the required levels will be nearly impossible without carbon capture.

This commitment also yields widespread economic benefits. According to one study, U.S. consumers could save an estimated $100 billion—or $655 per household—by 2040 from the increased use of natural gas throughout the economy, including power generation, thanks to its abundance and relatively low cost compared to other energy sources.

The path to a cleaner and more cost-effective energy future may be a long one, but we are already on it, blending a range of power sources for the energy demands we will face in years to come.

“Looking forward, new generating capacity will tend to be in the form of natural gas and renewables as more coal and nuclear plants are retired,” Santa said. “We’ll see a continuing role for natural gas—even if it shifts over time—not just as a bridge fuel but as a foundation for the future.”