Gas and Electric Utilities Have Important Roles in Decarbonized Energy

Gas and Electric Utilities Have Important Roles in Decarbonized Energy

The power generation sector has made great strides in creating decarbonized energy, with transportation overtaking the power generation sector as the largest CO2 producer in 2017. This change did not occur as a result of transportation emissions increasing or Americans using less electricity. The decline in power sector emissions is largely attributable to the switch from coal to natural gas and the growth in renewable energy generation, particularly wind and solar.

However, with fossil fuels still generating over 60% of U.S. electricity, and many energy industry leaders publicly pledging carbon neutrality by 2050, the transition toward cleaner energy production will need to accelerate in the coming years, and both electric and gas utilities will be key contributors to this transformation to decarbonized energy.

Many states have prioritized reaching their goals for decarbonized energy.

Many states have prioritized reaching their goals for decarbonized energy.

Throughout the U.S., the energy generation mix varies widely. Currently, 24 states and the District of Columbia have established economy-wide greenhouse gas (GHG) emissions targets, with some of the cleanest energy states having aggressive goals for 2030 and beyond. California’s goals are the most ambitious, pledging 40% reduction from 1990 levels by 2030 and carbon neutrality by 2045. Washington, Oregon and New York, also among the cleanest energy states, have reduction goals of 40-45% by 2030 and 80-95% by 2050. To achieve these goals, utilities must increase renewable generation, electrify transportation and proliferate energy efficiency programs.

In states where the energy mix is dominated by petroleum and coal, such as in the top coal-consumption states of Texas, Indiana, Ohio, Illinois and Missouri, natural gas conversion continues to be the primary path to decarbonized energy. Burning natural gas for energy results in GHG emissions that are 50-60% less than coal and 30% less than oil to produce an equal amount of energy.

The transportation sector accounts for the highest level of U.S. GHG emissions (29%), and therefore must be a major focus for all utilities. Cars and light-duty trucks account for 58% of total transportation sector emissions, making widespread adoption of electric vehicles essential to decarbonized energy for transportation. Utilities are in a position to drive EV growth, particularly among residential customers, by offering services to address some of the key pain points of EV charging, which is currently a disjointed experience that leaves consumers largely on their own.

A recent survey of North American utility professionals conducted by Bidgely found the primary barriers to greater adoption of EVs are insufficient charging infrastructure in their territory (67%) and lack of customer awareness of EV benefits (58%). A HomeServe 2021 study of prospective and current EV owners found similar results, with nearly 50% of respondents unaware of utility rebates and time-of-use programs. Additionally, 74% of prospective EV buyers responded that they were concerned about the potential for their level-2 charger to break. When EV owners were asked where they turn for electric vehicle supply equipment (EVSE) support, the number one answer was their utility, more so than vehicle and device manufacturers.

In partnership with utilities, HomeServe offers utility customers first-to-market EV charger support plans. The EV Charger Protection Plan includes reimbursement for a broken charger and coverage for the repair or replacement of wiring and components that are damaged due to normal wear and tear. The EV Charger Convenience Package includes charger installation, protection and guidance on related utility offers including any available incentives, time-of-use rates and demand response programs.

In addition to offering plans that help to increase EV adoption, HomeServe plans protect utility customers against the expense and inconvenience of HVAC, gas and electric lines, water heater and other home emergencies by providing affordable coverage and quality local service from vetted local contractors. As customers with a plan are more likely to repair or replace inefficient systems and proactively address issues, our solution promotes overall energy efficiency, reliability and safety. For more information, contact us.

Natural Gas Leads Energy Industry in Decarbonization

Natural Gas Leads Energy Industry in Decarbonization

Natural gas is shrinking the energy industry’s emissions, while utilities continue to improve decarbonization efforts with innovative processes and technological advances.

Natural gas has been playing an understated role in limiting climate change by becoming the largest fuel source in the global energy mix as dependence on coal begins to wither. According to data from the U.S. Energy Information Administration (EIA), in the last ten years 103 U.S. coal-fired power plants were converted to or replaced by natural gas-fired plants. This was driven by stricter emission standards, an abundance of low-cost natural gas, and more efficient natural gas turbine technology. Coal’s share of electricity generation has shrunk to under 24 percent, and it’s expected that trend will continue, with coal making up less than 20 percent of global demand by 2030.

In the U.S., coal use for electricity generation dropped by 18 percent just in 2019, causing overall electricity generation emissions to fall by nearly 10 percent, because natural gas generates approximately 50 percent less emissions than coal and 30 percent less than oil. Although the number of renewable energy sources has risen sharply, it is natural gas that is replacing coal as the most dependable choice for electricity generation, removing a net 150 million metric tons of emissions. This means that, for the first time, the energy industry has fewer overall emissions than the transportation industry, because natural gas has enabled the energy industry to reduce emissions to 1980s levels.

Currently 38.4 percent of the U.S. energy mix is generated by natural gas, the cleanest burning fossil fuel. The sector has made significant strides in decarbonization efforts, spending billions of dollars annually to eliminate fugitive emissions from supply lines by replacing leak-prone cast iron and bare steel pipes that could potentially release methane into the atmosphere. More than 17 percent of pre-1970 pipes were replaced between 2005 and 2019, and improvements in monitoring technology and methodology have made it easier and more cost effective than ever to find leaks. Tracking fugitive emissions is becoming more sophisticated, including collecting data from satellites.

Utilities know that they must be transparent about their decarbonization efforts because customers are concerned about climate change and regulators are considering penalizing heavy emitters.

The natural gas industry continues to innovate, decarbonizing through carbon capture, utilization and sequestration (CCUS) and implementing new plant technology. Presently 90 percent of CO2 can be captured and sold to a variety of industries such as enhanced oil recovery (EOR), concrete and fertilizer, and food and beverage, which are significant CO2 producers without a clear path to decarbonization.

A range of sequestration methods are also being employed, including afforestation and reforestation and saline aquifer injection. Approximately a quarter of carbon emissions are captured by forests, farms and grasslands, making landscapes a reliable source of carbon sequestering. Utilities are extending the opportunity for customers to support sequestering as well – for example, in Missouri, Spire gives customers the option of reducing their carbon footprint by planting trees.

Range and grassland are especially resilient, thriving even in the semi-arid environments of the western states. Grasslands are more efficient at storing carbon than forests in drought- and wildfire-prone areas. They are wildfire resistant because they store much of their carbon below ground in the roots.

Not only is CCUS good for the environment, but it’s good for the economy – from the supply chain for the energy industry to supported industries such as carbon dioxide enhanced oil recovery, CCUS maintains current jobs and creates new ones. Since the U.S. is a leader in CCUS technology, U.S.-based utilities stand to play a significant global role in clean energy.

While gas will be part of the clean energy mix as it replaces heating oil and coal in the medium term and nuclear energy in the long term, natural gas is less expensive than electricity. Natural gas also allows utilities to firm the grid when renewables produce intermittent energy and where there are peaks in demand.

Unfortunately, one of the places gas utilities can’t improve decarbonatization efforts is in the end user’s home – a leaking service line or a laboring furnace can cause safety and efficiency issues for utility customers. Customers may even be aware of inefficiencies but are unable to afford repairs. HomeServe plans cover gas and electrical service lines, water heaters, in-home electrical and plumbing systems and HVAC systems. To learn more about how our programs educate and protect utility customers, contact us.