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Natural gas can't get no respect

My understanding is that natural gas is a really promising candidate as a bridge fuel (a cleaner energy source between the coal/oil economy and whatever comes next), for all the reasons Steve Pearlstein lays out here. But nuclear energy attracts all the political attention. Why is that? Is it just because nuclear energy has traditionally been opposed by liberals and so it's become an article of faith among conservatives? Does nuclear energy have a more-organized or better-funded industry backing it?

By Ezra Klein  |  February 22, 2010; 10:01 AM ET
 
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Comments

I think it's probably because nuclear energy has much more growth potential. Gas prices are really volatile and a little pricey, while the generator technology itself is cheap. Moreover, natural gas is already a big part of our electrical grid, and dominates the "peaking" electricity market already. A carbon pricing regime would make it cheaper relative to coal, but price volatility and lack of scale remain issues.

Posted by: etdean1 | February 22, 2010 10:16 AM | Report abuse

There is no current mechanism for generators to get paid for running their gas plants more. Also most gas plants in the rural east are not for base load but for peak load. They may not have the ability to run longer than a few hours in the morning and evening either because of the equipment or the fuel source.

Remember that most businesses want to optimize their current investments rather than make new ones. They will not of their own accord run to natural gas. In fact they will resist and must be incentivized.

Posted by: BertEisenstein | February 22, 2010 10:20 AM | Report abuse

Natural gas plants don't have the capacity that nukes do for generating electricity. Gas is great for many other purposes, of course.

One is transportation. Several companies have patents for Gas-to-Liquid technology which can take natural gas and transform it into a very clean diesel fuel that is far more useful than the diesel of the 1970s. I'm told its so clean you could drink it with no ill effects. Yet, despite its greenness and ability to reduce dependence on oil, seems to be little interest in the US (Qatar, a huge gas producer, has a plant coming on line).

Posted by: silencedogoodreturns | February 22, 2010 10:24 AM | Report abuse

This is one of the most perplexing, but probably most consequential, policy decision or policy omission by this Administration. Here are my speculations in this regard:
- Steven Chu, our respected Energy Sec. who might be playing a role here. Because of his Physics background and his Nobel Prize, possibly he is more supportive of Nuclear Energy making Administration to commit more than $50B in loan guarantees. CBO says chances are that more than 50% that Fed will have to pony up this amount.
- President Obama's negligence in this matter. Many times he has shown this misplaced stubbornness about a policy and this seems to be a case here. Another is his misplaced insistence on Tax Cuts for Middle or Lower Middle class as stimulus. It can be justified as a political justice; but really that money could be more effectively used on 'spending' on infrastructure, even though that is longer term.
- Failure on part of GOP in holing the feet of Admin. in case of Natural Gas.
- Traditional 'anti Oil&Gas' lobby of Dem party. Rather than coming up with good regulations in controlling potential damage to 'water table' by 'shale drilling' techniques of Natural Gas; this ideologically driven wing of Dem Party is simply interested in killing this Nat. Gas boom.
- Finally, overall total lack of 'business savviness' by President himself and by this Administration. Most business people realize that promoting 'shale drilling' driven new Nat. Gas Boom is most optimal strategy in the current situation; but knuckle heads at White House do not get that. It is environmentally better than coal, from national security perspective it is better and it is economically viable. Steven Peralstein had good suggestion in how to deal with Labor cost of Coal Industry as those mines & plants become obsolete due to Gas.

Shame. One more unique opportunity wasted by Obama Administration.

Posted by: umesh409 | February 22, 2010 10:26 AM | Report abuse

This is a only partially informed guess, but could it be related to infrastructure costs? My father-in-law is an engineer who worked on a project to convert a fairly large fleet of vehicles off of gasoline. They ended up choosing propane over natural gas because they couldn't get sufficient gas piped to them for their demands and storing your own reserve is expensive (and dangerous). By contrast propane is relatively cheap to transport and store.

Likewise, increased electricity generation via natural gas would require massive pipeline upgrades. Common sense says that the infrastructure to deal with nuclear should be even more expensive, but maybe not.

Posted by: jleaux | February 22, 2010 10:30 AM | Report abuse

President Carter's published energy plan (1976/7) addressed the issue in detail. Natural gas is most useful as a transportation fuel (where nuclear energy is useless) but its use in transportation causes rapid depletion of reserves. Nuclear energy, while still requiring the finite raw material Uranium, is usable in electricity-producing plants.

Carter's presentation is detailed and has been the subject of 30 years of scrutiny, so it's useful. The topic really isn't partisan, which is also helpful.

Posted by: rmgregory | February 22, 2010 10:42 AM | Report abuse

Storage issues, transporation issues...hopefully a greater skepticism on everyone's part over the next "miracle fuel" since it's still a fossil fuel that will run out and will produce masive ammounts of carbon etc etc etc.

Not to say gas isn't a facet of the future of energy, but it's no panacea.

Posted by: EricS2 | February 22, 2010 10:46 AM | Report abuse

As an energy scientist, I often refer people to these Oil Drum articles that discuss the fact that we are likely seeing a peak in Uranium production:
http://www.theoildrum.com/node/2379
Anyone who acts like nuclear power is easy and that the fuel is abundant is a liar or moron.

Posted by: flounder2 | February 22, 2010 10:53 AM | Report abuse

You're absolutely right that gas should be a bigger part of the picture for us. Much of the infrastructure is there, and there are huge domestic reserves. Currently the way the majority of our electrical grid works is that we use coal for base load and gas for times of high demand. If we reversed that tomorrow, we'd already be most of the way to meeting Obama's emissions targets for 2020. Gas is a little bit more expensive than coal, but not much, and it's certainly a lot cheaper than nuclear. Not only that, but modern gas turbine generators with co-generation achieve greater than 60% efficiency, which is quite extraordinary for a thermodynamic process. Reserves of course would be limited, but we have enough domestic reserves to last for decades, which certainly is adequate to use as a bridge fuel. Joe Romm has written a lot of good stuff about our gas potential.

Bert Eisenstein made the same point about base vs. peak load, but it's simply a cost issue as to why it's like that, not equipment. As long as coal's slightly cheaper, why not burn it more? This is the area where I think we'd see immediate impact from a carbon price.

Posted by: AndrewDClark | February 22, 2010 11:01 AM | Report abuse

Ezra,
It's because we already have lots of natural gas development, and more on the way. The Federal and state governments have been bringing hundreds of gas wells, pipelines, and power plants on line in the last few years. New laws could change the velocity, but the curve is pointing up no matter what. By contrast, with nuclear power, however, we're stuck at zero growth unless the Federal government explicitly does something.

Posted by: tomveiltomveil | February 22, 2010 11:09 AM | Report abuse

I have definitely been wondering why nuclear power has become the new obsession from Republicans - the tag line from them has become "you can't have an alternative energy solution without nuclear power." You most certainly could and it might cost less, given the substantial fixed cost and loan guarantees needed to set up a new plant.

Obama has basically caved on this point to them with his recent announcement but I would really appreciate someone running the numbers about cost AND telling me where we are going to store the waste - from my understanding the space in Yucca Mountain is already accounted for by existing plants.

Not to mention that in this age of heightened security, a nuclear power plant could be a very potentially hazardous point of attack, especially relative to a wind or solar farm.

Just thinking aloud here, but I haven't heard any nuclear proponents address these issues.

Posted by: kmani1 | February 22, 2010 11:28 AM | Report abuse

I agree that it's dumb to throw a whole lot of federal cash at nuclear; but I want to at least problematize the idea that nat gas is a great "bridge fuel" to lead us a way from coal and to cleaner electricity sources.

In places where natural gas supplies are scarce, such as North America, drillers are resorting to a technique known as hydro-fracturing, or fracking, in which a mix of sand and chemicals gets injected into a rock formation at high pressure. The fluid fractures the surrounding rock, allowing gas to be pumped more easily from the well.

Needless to say, this is a destructive practice; and results in vast amounts of fouled water. In both British Columbia -- http://www.straight.com/article-282210/vancouver/lucrative-dirty-secret -- and across the continent in New York state -- http://nymag.com/news/intelligencer/topic/63669/ -- the practice is causing or threatens to cause massive ecological damage. Indeed, New York mag reports that NYC's celebrated city water is under threat from possible fracking in the upstate Marcellus Shale. I can testify that NY State residents who live above the Marcellus Shale are furious about the possibility.

This reminds us of the ever-unpopular, always-necessary requirement to live within our means--to live off if the earth's generous income stream, not its precious capital. Wind, solar, conservation, efficiency--those are the bridges we need to build.

Posted by: TomPhilpott | February 22, 2010 11:37 AM | Report abuse

Nukes produce more energy, number one. But also, and I know it may sound funny to say, but nukes are safer. Obviously, the high bar for disaster is greater with nukes, but the day to day average danger is much higher with natural gas. There was a piece on Frontline, I think, about natural gas explosions in Dallas (more frequent than you'd think). Recommended.

Beyond that, yes... I think it's politicized to some degree, but I also think there's a disproportionate fear factor re: nuclear energy among average people. Images like Chernobyl linger vividly, heh.

Posted by: roquelaure_79 | February 22, 2010 11:58 AM | Report abuse

Here are few more points to consier:
- Steven Peralstein at WaPo has good points in this regard and it is a must read article.
- Ezra needs to follow this issue in much more depth than what he has done. This is very important issue precisely because there are 'actionable items on table for WH'. In other words, here Admin can make the difference without running much into Congress, our infamous broken Congress.
- I believe Admin is going to revert $30B of subsidies of Oil and Gas industry; but under writing more than $50B for Nuclear industry which is always beset by delays and cost overrun, which is unlikely to change. Withdrawing subsidy is probably going to impact Nat. Gas industry which should really be spared.
- Few commenter have pointed out that raw material for Nuclear industry is not infinite and not that European Fusion reactor is coming soon. Even if Chu's favorite Lawrence Livermoore Lab Laser based experiment is successful; it is still very early stage for any such things to become production ready.
- Also 'waste' is still a big issue with Nuclear. When Nevada waste repository plan was on, the risk of transporting it from all over the country was an issue. Now, all waste will be continued to be stored locally; again not a very effective solution from oversight and management perspective.
- Shale Nat. Gas discoveries are spread over number of states. So we are not talking here 'pipeline from Alaska' which though planned not likely to be very lucrative today. In fact Western pipeline is also under 'financial viability' attack. This all means, people are making mountain of 'hey stack' when they talk about transportation needs of Nat. Gas.
- I am not sure days of each nuclear plant of 2K MW and cluster 5 or 6 of them together to get monster capacity of 10K MW or more in one single location (as like how they do in Japan) are still applicable. For one thing, even 1K MW big Nuclear Power Plant has the price tag of more than $5B; probably $7 to $8B which is making power generation companies to balk. Add to that invariable delays and really the financial sense of Nuclear Energy goes out of whack.
- With longer term contracts, which are possible due to abundance of gas, gas plants can be 'base load' as well instead of 'peak load'. Price wise at that point those can compete with Coal Fired ones. Besides, simplicity of design (fewer parts to make a Gas plant) makes is easier compared to Nuclear.
- As WSJ article reported, smaller nuke plant, 150 MW or so; that could one future option. But again those are still experimental whereas Gas plants of that size are very easy to erect and start production.

We really need serious debate about this issue and need to make the misguided and 'ultra-expensive' route of this Administration altered.

Posted by: umesh409 | February 22, 2010 11:58 AM | Report abuse

The Natural Gas Industry is a mess. The Nuke guys are focused and united around messaging Nukes as the solution for climate change. Most NG CEO's doubt the science and fear climate legislation - even when it is written to favor NG. Just look at the NG industry - companies range from Exxon (Oil first, gas second) to Chesapeake and Devon (focused and progressive gas companies). In addition you have a whole host of producers which are basically wild catters backed by hedge funds. If the industry could get their act together and advocate for their solution to climate - they would offer the lowest cost way to a lower carbon low pollution future.

Note: over the next four years - just as new supplies are assuring a low cost low carbon future - gas is projected to drop from supplying 21% of our electricity to 14%. Not good.

Posted by: mbaker64 | February 22, 2010 12:27 PM | Report abuse

This is a trick question, isn't it?

The answer is too easy: Because the benefits from federal support of nuclear will be concentrated in just a few dirty hands, it's much easier to organize a very lucrative and effective lobbying and PR campaign.

There are only two US suppliers, GE and Westinghouse, and a maximum of 10 giant utilities that would implement. So it just takes a dozen multibillion dollar companies to aggregate the funny money and start spreading it around. And since all it takes on the Fed side is loan guarantees, it's a simple act that delivers Billions$ in long term profits.

And finally, since the real federal cost is risk, and there is no GAAP for government risk reporting, our entire federal treasury is put at risk of a single nuclear accident, all for private benefit. And officially, no risk is reported.

The more concentrated the wealth, the easier the trip through Washington.

But if Ezra had to admit that, then he'd have to recognize that his "policy" column is, sadly, a waste of time. And Fred Hiatt would never allow a "follow the money" column, because all his ad revenue comes from lobbyists.

Posted by: Dollared | February 22, 2010 1:35 PM | Report abuse

I have never, ever understood how natural gas/nuclear became a partisan issue.

Look, I'm as liberal as the come, but natural gas is a bit over-hyped. It is a 'cleaner' fuel, but it's far from clean. TomPhillpot's post says it pretty well.

There are three basic complaints about nuclear power - safety, disposal, and fuel. For the life of me, I don't see why you'd worry at this point about the fuel source. Fast breeder reactors have a lot of potential to produce nuclear power for a long time.

Safety is also pretty misunderstood. A pebble-bed reactor is cooled by inert gas, not liquid, so it's not as prone to damage, and it doesn't generate more heat than can be drawn through the containment walls, so it simply can't go critical. There's an embedded fear of Cherynoble, but that was a joke: it's what happens when you take an aged Russian reactor and decide to turn off all the safety features at once. Bloody surprise, that one.

As for disposal - look, I agree that getting rid of nuclear waste is no fun, but a standard reactor produces about a coffee-table size amount of the stuff each year. Handling that isn't easy. But right now, the waste storage plan for our other energy sources are 'the atmosphere', so at least the nuclear industry is engaged in the problem.

Posted by: strawman | February 22, 2010 2:37 PM | Report abuse

Fusion is the real answwer for the future, plus diffused small-scale renewables. Fusion is closer than most people think, as Unmesh says, and the Europeans will probably get there first, while the Chinese are ahead in solar and other renewable technologies. Nuclear is one thing the US can do, however. And nat gas is at best only a bridge, not the fuel of the future.

Posted by: Mimikatz | February 22, 2010 2:43 PM | Report abuse

Partly because natural gas produces CO2. And partly because the US approach to nuclear has been so enormously skewed since Three Mile Island. We put so many regulatory barriers in our own way that we are just incredibly far behind everyone else in the world. A little regulatory relief would be enough to jump-start the industry in a big way.

Posted by: MikeR4 | February 22, 2010 4:29 PM | Report abuse

Just tell conservatives that Nuclear power is French considering the amount they use it.
They'll drop it like a pound of former freedom fries.

Posted by: nomadwolf | February 22, 2010 8:13 PM | Report abuse

The nuclear power industry is not asking for "regulatory relief." It is asking for blanket insurance policies, in the form of liability caps that put the risk of trillions in losses on the whole society, and loan guarantees that put the risk of loss on the whole society via the federal government. It is asking, in other words, for billions and billions - and billions - in subsidies.

How about we put those billions into efficiency? Wind? Solar?

Posted by: Dollared | February 22, 2010 8:13 PM | Report abuse

Nuclear emits almost no greenhouse gases, its garbage problem is local rather than global, and no one wants to have a liquified natural gas terminal built in their neighborhood so all the gas we'll ever have is what is here right now.

Sad, but true. Nuclear, with all its problems, is better than any of the other feasible alternatives for large scale energy production.

Posted by: pj_camp | February 22, 2010 9:08 PM | Report abuse

"The nuclear power industry is not asking for "regulatory relief."" Dollared, you didn't address my point. I don't know what they're _asking for_, but I was discussing why we have made no new nuclear plants in a long time, and France has converted pretty much their whole energy production to nuclear. The US federal government has made things almost impossible.

Posted by: MikeR4 | February 23, 2010 1:48 PM | Report abuse

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