Natural gas has moved to the centre of the current debate on energy, security and climate. This study, ‘The Future of Natural Gas’ is the third in a series of MIT multidisciplinary reports examining the role of various energy sources that may be important for meeting future demand under carbon dioxide emissions constraints
The overarching conclusions from the report are that:
- Abundant global natural gas resources imply greatly expanded natural gas use, with especially large growth in electricity generation.
- Natural gas will assume an increasing share of the US energy mix over the next several decades, with the large unconventional resource playing a key role.
- The share of natural gas in the energy mix is likely to be even larger in the near to intermediate term in response to CO2 emissions constraints. In the longer term, however, very stringent emissions constraints would limit the role of all fossil fuels, including natural gas, unless capture and sequestration are competitive with other very low-carbon alternatives.
- The physical properties of natural gas, the high degree of concentration of the global resource and the history of US energy policy have profoundly influenced the use of natural gas and the market structure governing its trade:
- the substantially lower carbon footprint of natural gas relative to other fossil fuels, combined with the development of North American unconventional natural gas supply and the high cost and slow pace of lower carbon alternatives, has focused attention on natural gas as a “bridge” to a low-carbon future;
- there are regionalized markets in North America, Europe and industrialized Asia, each with a different market structure; and
- “feast or famine” expectations for US natural gas supply, associated with price swings and policy changes, have often led to costly investment decisions.
A full report with additional analysis addressing a broader set of issues will follow later this year.
Photo from Creative Commons: Flickr: mkrigsman