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By Valerie Volcovici, Isla Binnie and Ross Kerber
WASHINGTON/MADRID/BOSTON, June 24 (Reuters) - Power company
executives argued during a global energy conference this week
that natural gas will have a long-lasting role in the transition
to a climate-friendly global economy, even as environmental
groups, progressive politicians, and intergovernmental
organizations contend fossil fuels of all types must be phased
out fast to stop global warming.
The heads of U.S. utilities Duke Energy Corp and
Edison International, Spanish multinational Iberdrola SA
, power equipment and technology provider GE Gas Power
, and engineering firm John Wood Group PLC, told
the “Reuters Event: Global Energy Transition” conference this
week that natural gas will be needed for decades to come.
They said its near-term role would be to continue to replace
its dirtier rival coal, and that its longer-term role would be
as a complement to renewables, switching on during periods when
emissions-free sources, like solar and wind energy, are
unavailable.
“As we look into the future, we see it transitioning away
from being a baseload, all-the-time, resource to more of a
peaking and balancing resource,” said Lynn Good, chief executive
of Duke Energy, the largest electric utility in the United
States, who estimated natural gas would be part of the energy
mix well into the 2040s.
Ignacio Galan, CEO of Iberdrola, agreed: "Natural gas is
going to be needed still for a long period of time but not as
baseload.”
He predicted that regulators would need to figure out new
ways to pay gas-fired power plants to remain on standby, so they
are “readily available whenever it is needed."
Scott Strazik, CEO of GE Gas Power, said he expects gas to
be long-term complement to solar and wind power, and that its
emissions would eventually be dealt with through carbon capture
and sequestration technology, which stores greenhouse gases
underground.
"Gas is a force multiplier for growing renewables. It allows
us to take advantage of the awesome power of the wind and sun …
for the inevitable periods when renewables alone are not able to
meet demand,” Strazik said.
Pedro Pizarro, CEO of Edison International which operates in
California, said his company believed 6% of wholesale power
would still come from natural gas in 2045.
“Gas continues to be a bridge fuel, I don't think you can
pull the plug on it overnight,” he said.
CLEAN BREAK VS ENERGY SECURITY
The comments clash with some climate advocates who want a
clean break from fossil fuels. While gas has long been seen as a
relatively clean-burning source of energy, research has been
mounting that its use leads to unintended emissions of methane,
a powerful greenhouse gas, leading environmental groups and some
local governments to push for anti-gas regulation.
The International Energy Agency, an intergovernmental group,
meanwhile, issued a report last month that said reaching
net-zero emissions by 2050 would require an end to all fossil
fuel investments, including for gas, and that the world’s
electricity should be made up of a combination of renewables and
nuclear power by that point.
U.S. President Joe Biden wants utilities to achieve net zero
emissions in power plants by 2035. And in Europe, the European
Commission has proposed rules to restrict funding for natural
gas projects because of the risk they pose to the bloc’s climate
goals to decarbonize by 2050.
Robin Watson, CEO of consulting and engineering company John
Wood Group, told the Reuters conference that he believed funding
of existing gas assets should be optimized even as more money is
funneled to building more sustainable future sources.
“To maintain energy security, which still underpins our
quality of life, we need to accept and shape a role for
hydrocarbons that is still compatible with our net-zero
ambitions. This is a pragmatic and important compromise, not a
cop-out," Watson said.
Scotland-based Wood's business lines include work in both
renewable energy and the oil and gas and chemical sectors.
For more?on the Reuters?Events: Global Energy
Transition?conference please click here https://reutersevents.com/events/energy-transition-global/
(Reporting by Valerie Volcovici, Isla Binnie, Ross Kerber and
Rich Valdmanis
Editing by Marguerita Choy)
