Baker Institute: electric cars hold most promise for reducing carbon emissions

The James A Baker III Institute for Public Policy released a major study yesterday on the consequences of an emerging US carbon management policy. There are lots of strands in the report to be picked over. The one I found most interesting was that electric cars hold greater promise than establishing a national Renewable Portfolio Standard (RPS) in reducing carbon emissions and lowering US oil imports. This is from the report:

The single most effective way to reduce US oil demand and foreign imports would be an aggressive campaign to launch electric vehicles into the automotive fleet. In fact, mandating that 30 per cent of all vehicles be electric by 2050 would both reduce US oil use by 2.5m barrels a day beyond the 3m barrels-per-day savings already expected from new corporate average fuel efficiency standards, and also cut emissions by 7 per cent, while the proposed national renewable porfolio standard would cut them by only 4 per cent over the same time.

This finding underlines the potential for the US to make good use of its natural gas boom to supply this growth in electricity usage.

The study noted that there are estimates the US now has as much as 1,000 trillion cubic feet of natural gas extracted from shale – enough to supply current US natural gas consumption levels for the next 45 years. Taken together with other conventional and unconventional natural gas resources, the US resource base is large enough to meet current US natural gas conumption levels for the next 100 years or more.

It was refreshing to hear Diezani Alison-Madueke, minister of Petroleum Resources for Nigera, at the Baker Institute forum where the report was presented, note that her country is implementing its gas master plan to make good use of the resource.

But the fact that Nigera has recognised gas’ potential also underscored how the US has yet to accept the benefit of this fuel source, both as a clean energy fuel (it is about 30 per cent less carbon intensive than oil and 50 per cent less than coal) and as a domestic source to help make the US more self-sufficient. Nothing significant has come out of Congress or the Obama Administration that recognises this potential.

The main criticism against natural gas in the US is that it is still a fossil fuel. But the reality is that it is used by manufacturers of renewables, such as wind and solar, as a backup fuel source when the wind does not blow and the sun does not shine. So it is needed to grow those sources.

Certainly, natural gas still emits carbon, which makes it less desirable than renewable energy resources. And fracturing the rock to obtain the gas requires large quantities of water laced with chemicals, which critics fear could leak into groundwater and aquifers. Shale developments have been blamed for contaminating wells and the death of livestock exposed to potassium chloride in the water used to fracture the rock; this has led regulators to consider buffer zones around reservoirs and aquifers.

But the Baker report addressed these concerns:

Environmental critics of shale gas say drilling for shale gas runs a risk to groundwater even though shale is generally found thousands of feet below the water table. If a well casing fails, drilling fluids can seep into aquifers, but this has not generally been a pervasive problem. Drilling itself is relatively safe, so critics may have overplayed its dangers. But water pollution can occur if the drilling fluids are disposed of improperly, as has been the case in several locations, so regulations and enforcement must be tightened to ensure safety.

All that can be done, and shale gas can continue to be extracted. Jim Mulva, chief executive of ConocoPhillips and a keynote speaker at the event, said he believes gas can be – and should be – a bigger part of the solution. From his speech:

Fossil fuels can’t be replaced by hitting a switch, and hoping the renewable sources come online fast enough.

That does not mean Mr Mulva is against them:

At ConocoPhillips, we believe that all energy sources will be needed in the future – including renewable sources. We are researching them, and have produced them. We also acknowledge that greenhouse gas emissions and their link to climate change raise genuine concern. But our business focus is on oil and gas, because these are the sources most readily available, at reasonable cost, to consumers today. We further believe there are three key points to remember about gas.

  • First, it’s an energy game-changer;
  • Second, gas can help drive economic recovery, and job creation;
  • Third, the US needs a balanced energy policy. One that enables greater use of gas in the most efficient, productive and environmentally beneficial ways.

After reading through the Baker Institute’s new report, it seems the best way to do that would be to encourage gas’ use to power the grid for plug-in electric vehicles.

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