Selected category: Natural Gas

The California Gas Disaster: What Comes Next and Where Else Could it Happen?

storage_2013The ongoing leak at the Aliso Canyon natural gas facility owned by Southern California Gas has driven more than 2,000 families from their homes in the Porter Ranch area of Los Angeles and prompted Gov. Brown to declare a state of emergency. It’s dumped an estimated 83 thousand metric tons of methane into the atmosphere so far (see our leak counter here), with no clear end in sight.

But what are the next steps from here? What are the wider implications of this continuing disaster; and where else could something like this happen? What do we do to prevent another Aliso, and how will Southern California make up for the environmental damages once the leak stops?

The troubling fact is that Aliso Canyon is just the tip of a very big iceberg, reflecting both the industry’s widespread methane problem, and the potential local risks of over 400 other storage facilities nationwide. It spotlights a longstanding, largely invisible problem, promising to shift political dynamics around solutions. And the penalty phase, when it comes, will hopefully codify important principles that will also have a big effect on industry behavior. Read More »

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Methane Emissions are Risky Business for Investors

No one likes uncertainty, least of all investors. From changes in interest rates, to supply chain disruptions, the list of risks investors must monitor is long and growing. Good, actionable information is investors’ most important tool for risk management and integral to successful investing. Without proper data, investors are flying blind.

A new report published by EDF this week  throws the spotlight on a growing risk for investors—methane emissions from the oil and gas sector. As so clearly demonstrated by the ongoing and massive leak at Aliso Canyon, methane emissions pose a multitude of expanding risks, with both short and long-term consequences.Three key risks from oil & gas methane

At 84 times more powerful than carbon dioxide in the short-term, methane emissions represent a potent and fast-emerging form of carbon risk. In a world looking to reduce carbon pollution, methane emissions pose regulatory, reputational and economic risks. Preparedness to comply with forthcoming rules varies across the industry, methane undercuts natural gas’ ability to play a role in a carbon-constrained world, and emissions of methane are lost product amounting to $30 billion a year globally. Read More »

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Tech Innovation in the Energy Utility Space: Good News & Room for More

281848673_f2dbe9926d_oA survey released this month by a top management consulting firm found that 80 percent of the companies polled – including Apple, Google and Tesla – rank innovation among their top three strategic priorities. Unfortunately, the nation’s utility sector seems to be behind the curve when it comes to embracing this idea.

Utility companies invested just 0.1 percent of revenue in research and development in 2013, according to the National Regulatory Research Institute. That’s less than 1/30th the national average of 3.3 percent for all industries. In fact, R&D spending by energy utilities has declined in absolute terms since the mid-90s. But that’s only one piece of the problem. There’s also the related problem of low adoption of new technologies by the sector, which some have attributed to a culture of caution.

That’s why it was so noteworthy when Public Service Electric & Gas Company (PSE&G), New Jersey’s largest and oldest publicly-owned utility, announced it will use data gathered by EDF using cutting-edge leak quantification technology to prioritize a massive $905 million pipeline replacement program. After assessing public safety considerations, PSE&G will use data on methane emissions from its pipes to identify those most in need of replacement. Read More »

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Infrared Camera Reveals Huge, Wafting Cloud of Methane over California’s Aliso Canyon

Methane pollution from the oil and gas industry is a serious problem for our climate and communities, but it’s one most people aren’t even aware of. That’s because, while methane is a powerful pollutant, it is colorless, odorless and invisible to the naked eye.

But residents of Southern California’s Porter Ranch neighborhood had their eyes opened wide to the methane problem when a natural gas storage well in nearby Aliso Canyon ruptured and created a massive leak right next to their homes – an incident detected by residents in October from the putrid smell of mercaptan, an additive utilities use to more easily detect natural gas leaks.

Natural gas is made mostly of methane, and when it is released unburned, it has a warming power over 84 times that of carbon dioxide over 20 years. So, leaking or intentionally emitting unburned natural gas – which happens not just through malfunctions but often during routine production and transportation of oil and gas – can do major climate damage. The California Air Resources Board estimates that Aliso Canyon is pumping out methane at about 50,000 kg per hour, or about 62 million standard cubic feet, per day – that’s the same 20-year greenhouse gas impact as the daily emissions from 7 million cars.

Now, on day 48 in a very uncertain timeline of the one of the largest U.S. natural gas leaks ever recorded, infrared cameras are giving us a true glimpse at the size of this man-made methane volcano. Looking at side-by-side images of Aliso Canyon taken on Dec. 9 using an everyday camera and one equipped with infrared technology reveals just how blind we are to this kind of pollution:

Aliso canyon 2 Read More »

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Caution: Future Market Need for Natural Gas Pipelines is Smaller than You Think

alaska-67304_1920Like a racer facing a caution flag warning of hazards ahead, America’s natural gas pipeline developers are seeing signs that their business plans aren’t tracking with the future. Mistakes in this race carry price tags in the billions, and could leave ratepayers (in other words, the public) footing the bill for decades to come.

Two recent developments in particular – a report from the Massachusetts Attorney General’s Office and a rate case at the Federal Energy Regulatory Commission (FERC) – show that the economics for new natural gas pipeline capacity to supply power plants are not as compelling or sustainable as the conventional wisdom would have you believe.

Together, the AG report and the FERC case provide a strong counterpoint to those now rushing to create excessive new pipeline capacity.  They suggest that many pipelines will lose customers and money as lower cost alternatives outcompete them, and long before investor expectations are met and their financing is paid off. The question is whether policymakers and pipeline developers will slow down and consider the dangers, or continue to plow ahead. Read More »

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The World Has A Methane Problem – But We Can Solve It

As I write this, a massive methane leak from a ruptured natural gas storage facility in California is causing, every day, as much climate damage over the next 20 years as seven million cars on the road.

And as the climate talks here in Paris continued over the weekend, The Washington Post noted an increased focus on short-lived climate pollutants such as methane. This focus is an absolute necessity: If we want to solve climate change, we have no choice but to tackle methane emissions.

According to data from the Intergovernmental Panel on Climate Change, methane pollution is responsible for 25 percent of the warming our planet is experiencing today. It has this incredible impact because it’s 84 times more potent than carbon dioxide over the short term.

The largest industrial source of methane emissions is the oil and gas industry, and their environmental impact is staggering: A short-term climate impact equivalent to 40 percent of global coal combustion. That’s a lot of potential benefit to the climate, if we can make significant reductions.

That math is why the danger of unchecked methane pollution also offers us such an opportunity. Read More »

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