According to John Hanger, relying on data from the U.S. Energy Information Administration, carbon emissions are falling back to 1990 levels, something believed impossible only a short while ago. The reason for the falling emission levels? John provides the following:
First and foremost are sharp reductions from electric power production, as a result of fuel switching from coal to gas, rising renewable energy production, and increasing efficiency. Yet, the shale gas revolution, and the low-priced gas that is has made a reality, is the key driver of falling carbon emissions, especially in the last 12 months.
As of April, gas tied coal at 32% of the electric power generation market, nearly ending coal’s 100 year reign on top of electricity markets. Let’s remember the speed and extend of gas’s rise and coal’s drop: coal had 52% of the market in 2000 and 48% in 2008.
I suspect that some of the decrease in emissions is due to the faltering U.S. economy: slower growth results in less energy consumption. I also wonder how much the Obama Administration has had an effect: they’ve been hostile to coal, to say the least. Is this the result? Clearly though the transition from coal to natural gas (due to a number of factors I’ll explore later) has clearly benefited the U.S. in terms of realizing emission targets.
Tapping natural gas from shale formations has its critics, but there can be no doubt that increasing our reliance on natural gas over coal for energy production is a powerful short-term strategy for reducing carbon emissions. I’ve seen a lot of different numbers, but according to the EPA, compared to the average emissions from coal-fired generation, natural gas produces half as much carbon dioxide, less than a third as much nitrogen oxides, and one percent as much sulfur oxides, all nasty stuff.
Over the long-term, our economy still needs to transition toward renewable and clean sources of power. But hey, we celebrate short-term victories here! Plus, it’s good news for your Fourth of July! Now why did I sell those natural gas company stocks?