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Gas is the best way to address emission problems, says IGU president

David Carroll, president of the International Gas Union, talks about the benefits of gas as the IGU readies for COP21

The gas industry has been marshalling its arguments in favour of a wider use of the fuel, chiefly in the power generation sector but also in the road transport and heating sectors in readiness for the COP21 talks in Paris this December.

Not so long ago this would have been considered as pushing against an open door, since the benefits of gas – relatively sustainable and competitively available without the need for subsidies – were plain to see. Combined with the intermittency problem of renewables and the unrivalled flexibility of gas-fired power, the argument seemed to have been won.

The problem facing industry is that any amount of carbon in the fuel mix is a problem for some of the most influential lobbyists. So they will be hoping that the data they have collected from cities that have embarked on a ‘clean air’ policy – typically by outlawing coal in the power sector – will carry more weight with governments than will protests against any form of carbon dioxide-emitting technology.

Senior executives of its main lobby group, the International Gas Union, told Petroleum Economist  21 October that the time had come for action, not so much in order to limit emissions of carbon dioxide – whose consequences are uncertain and remote, in human terms – but to limit particulate matter in the air. They are hoping that its flexibility will be a necessary part of any future market where intermittent renewables account for a bigger share of the mix.

“These are urgent matters, and they are well understood”, says Mel Ydreos, chair of the coordination committee and external affairs of the IGU. “This is not a conceptual idea about some time in the future, it is very real, very current and very serious, and it has to be dealt with.”

“As you address air quality by replacing coal with gas, you also address carbon,” says the president of the IGU and chief executive of the US Gas Technology Institute, David Carroll. “If governments are really serious about the quality of life and emissions, gas is the best way to address it,” he says. The timing is also good, given the growth of trading and other commercial developments in liquefied natural gas.

“We are trying to direct policy-makers’ attention to the externalities. We have to make a difference today. But we see not only the opportunities such as improved economics and air quality. We are trying to cut through the debate with insightful analysis and messaging today, while considering the energy portfolio of 2050.”

By that date the world’s population is expected to double and energy demand is expected to go up by anywhere between 30% and 70% depending on the scenarios, Ydreos says. The need for energy will rise; the trend for urbanisation will continue; and there will be societal issues surrounding energy use. “In all scenarios gas fares very well.”

In the US the gas has replaced coal in the power sector already in several months per year, as the gas price has been more favourable; but the Obama Administration’s Clean Power Plan will guide states towards less coal use. “It tackles the issue of lowering carbon, but it is not prescriptive. Federal governments have the tools to implement the plan without damaging the economy,” he says.

The presentations they will make during the course of the talks will take as examples four cities: two in North America, New York and Toronto – which has completely outlawed coal from the power sector – and two in Asia: Istanbul, which had been “brought to its knees” by air pollution; and Beijing, which has also adopted an aggressive approach to the problem. The concentration of particulates in the atmosphere have fallen thanks to gas used in power generation, and that was the reason behind Toronto’s abandonment of coal. Studies had shown that the external costs of coal, measured in terms of lower life expectancy and poor health generally, affecting productivity as well as higher healthcare costs, were much greater than they were for gas.

Transport is another area where gas could grow – in the heavy end of the shipping and road transport sector – 18 wheel trucks. IGU secretary-general Pal Rasmussen said that the market for small – coastal or river – new-build vessels was the most developed in Europe, but other sectors would grow. Scandinavia is leading the way in ferries, while Anglo-Dutch major Shell is among those developing bulk-breaking technology for road and ship transport, taking advantage of available capacity at LNG import terminals. Ultimately the plan is to cut sulphur in fuels used in waterborne transport to almost nothing, giving LNG an advantage over most other fuels.

But as ever, the infrastructure is lagging behind as there is not the demand to build it. “There has to be some kind of fuelling stations, and mobile ship-to-ship refuelling,” Ydreos says.

The senior staff were meeting in Cartagena, Colombia, for the IGU annual council meeting. The IGU’s task is to advocate gas as an integral part of a sustainable global energy system, and to promote the political, technical and economic progress of the gas industry up and down stream. Its members represent over 95% of the global gas market. 


 

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