The Trump administration intends to scrap the Clean Power Plan, the Obama era policy to reduce carbon dioxide emissions from electrical power generation — mostly from existing coal plants — by 32 percent by 2030, below 2005 levels. The Clean Power Plan was supposed to help the U.S. meet its commitment to the Paris Climate Agreement. But researchers at Carnegie Mellon University found that the U.S. can still meet, or maybe even beat, its emissions reduction targets without the Clean Power Plan. They looked at emissions data from the government’s 2017 Annual Energy Outlook, and published their findings in Environmental Science & Technology.
The Allegheny Front’s Kara Holsopple recently sat down with one of the lead researchers to learn more. Paul Fischbeck is a professor in engineering and public policy, and social and decision sciences at Carnegie Mellon.
Paul Fischbeck: It turns out that the emissions from power generation have decreased considerably over the last five to eight years, from 2.7 billion tons down to an estimated 1.9 billion tons. A major factor in this reduction is the low price of natural gas, and the market forces that allow natural gas to replace some of the coal generation.
Kara Holsopple: Natural gas is cheap now, so that’s the preferred energy source over coal because of the market. But what if prices increase or even stay the same?
LISTEN: “Do We Even Need the Clean Power Plan Anyway?”
PF: There are a lot of moving parts here. So one is what happens to the economy? If the economy really starts to boom, electricity demand will go up, which could lead to higher prices for natural gas, which then could make coal more competitive again. So the Clean Power Plan’s goal was to reduce carbon emissions from generation, and they had a multi-pronged approach to do that. So they were encouraging the use of renewables and they were discouraging the use of coal. The Trump administration has come in and basically stopped that program. What’s happening now is due to just market forces. And so what you’re seeing is, with the low price of natural gas, it is replacing coal — but not only coal. Nuclear power has a very hard time competing at this very low natural gas price. If the prices were to go up for natural gas, then these other generation technologies could become once again viable in the marketplace.
KH: If I’m understanding your study correctly, natural gas could help us get to these targets that we want in the short term, but not necessarily in the long term.
PF: Based on our study, we’ve already achieved the 2025 goal for carbon emissions from power generation. Today. Already. So we’re eight years ahead of where we wanted to be with the Clean Power Plan. What about the goals that the Clean Power Plan had set for 2030? Can those be achieved without any other interventions? Or how can they be achieved if the price of natural gas goes up? These are the policy questions that we are researching now.
KH: During the Obama administration, natural gas was called a “bridge fuel,” to get a cleaner energy scenario that would include, eventually, more renewable energy [like] wind and solar. Natural gas is still a fossil fuel. It has its own greenhouse gas issues – methane – which is released when it’s extracted. Are you suggesting we should rely on natural gas in the long term?
PF: Making forecast into the future is always very difficult. And the questions are 10, 15, 20 years from now, what is the technology for generating electricity going to be? If you back up ten years, no one had forecast this revolution of natural gas prices. And so to go forward 10 years, there could be even more significant technological breakthroughs that would allow us to do things in a very different way. So there are a whole range of new technologies. For instance, small modular reactors (SMRs), which are nuclear power plants are much smaller, more efficient and potentially safer. That technology is just beginning. [If] it were to meet its stride, it could replace lots and lots of generation. Likewise, the price for renewables is also coming down. And so it could very well be that renewables now become more competitive. And if we get a battery technology breakthrough, which allows us to store that renewable electricity, then it’s a game changer.
KH: One of the reasons that renewable energy has become more affordable is because of tax credits. If the federal government isn’t mandating some kind of conversion or incentive for more renewable energy, with regulation like the Clean Power Plan, how else might that be accomplished? Or are market forces enough?
PF: Well this is always the big complaint between the two sides. If the government is providing subsidies for renewables, they’re tipping the balance of the in the marketplace towards one side. Is that a good idea? It has both pluses and minuses. When you start to play with the market, you often have unintended consequences. One of the administration’s longer term plans is to remove those interventions by the government, and let the marketplace fall out to where it’s going to fall out. One of the problems is these tax credits tend to come and go. And it’s very hard for renewable generators to make long term plans. So how do you start to account for making business decisions when you have politically adjustable tax credits that are occurring? If you can rely more on the marketplace, it is perhaps more predictable.
“The lower price of natural gas, in part to fracking, has reshuffled the deck as to what options are available. And more options is good, not bad.”
KH: If gas prices stay low, why wouldn’t you just continue to rely on natural gas?
PH: Yeah, that’s going to be the case now. Natural gas has surpassed coal now for a generation. Natural gas has about half the carbon emissions that coal does. And we’re seeing this in Pennsylvania where they’re taking power plants that used to burn coal and they’re being converted to burn natural gas. This trend will continue if the natural gas prices stay low. But here’s another government factor that could in fact creep in: What if we start to sell our natural gas overseas? Well, that’s going to make the price of natural gas in Japan and Europe go down, but the price of natural gas in the United States would go up. What would the impact of that be on the market? And that’s a big, big factor that’s pending in the future.
KH: I would imagine that a lot of environmentalists would look at your study and think, ‘This is dangerous. This sounds to me like we don’t need to do anything.’
PH: Well that’s not what we’re saying. We’re saying we have to consider the entire system that includes the marketplace, regulation and subsidies, and how those all interact with each other. And that simple answers are never the answer. The lower price of natural gas, in part to fracking, has reshuffled the deck as to what options are available in the future for us to attain various carbon emission goals. And more options is good, not bad.
Photo (top): American Public Power Association