What Will Low Natural Gas Prices Do To Renewables?

01/19/2012 from Yale Environment 360

The sheer abundance of recently discovered natural gas resources in the U.S. could drive down gas and electricity prices in the next few decades, yield an overall increase in energy use, and stunt the nation’sstill-emerging renewable energy sector, a new report says. Using economic modeling, researchers at the Massachusetts Institute of Technology (MIT) found that relatively cheap natural gas — much of it to be extracted from underground shale formations — could represent an increasingly large share of U.S. electricity use, particularly in the face of a weak national climate policy. By 2050, the report says, this growth could cause national energy use to increase, possibly leading to a jump in greenhouse gas emissions of 13 percent above 2005 levels. Absent this supply of natural gas — which has become increasingly available as a result of improved drilling methods, including the emergence of hydraulic fracturing, or “fracking” — the U.S. could have expected emissions to decline 2 percent, the report says. The ascendance of natural gas could also retard the development of carbon capture technology, the report says.