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Shale Gas Revolution: Setback or Boost for Renewable Energy Future?

Emmanuel Py's picture

Is the shale gas revolution a brake on progress towards faster adoption of renewable energy? Many argue that it is, but there is also persuasive evidence that it could also  boost integration of renewable energy into power grids, by providing a complement to intermittent sources of electricity.

A Citigroup study,[1] while acknowledging that natural gas and renewables both compete for a share of primary energy consumption, argues that they are not necessarily in direct competition. Natural gas is a versatile fuel, with multiple end uses—including electricity generation, as well as other applications in residential, commercial, industrial and transportation sectors—while renewables are used almost exclusively on electricity generation.

The study argues that renewables and shale gas are mutually reinforcing—in a “symbiotic relationship”—each helping the other increase market share:

  • Wind and solar power are intermittent sources that require backup (or “peaking”) plants that can quickly ramp on and off to support them. Those peaking plants often run on natural gas.
  • Germany’s experience suggests the critical role of gas as backup; the graph shows the contribution of wind and solar energy to German electricity demand simulated with twice the penetration of renewables on three representative days: a winter day, a sunny workday, and a sunny weekend day.

The right chart shows that, during a sunny weekend day, solar will provide sufficient supply not only to meet peak demand but for most of the entire load as well. As solar and wind power grow, they will substantially eat up the base-load currently supplied by coal and nuclear. This could mean that, since coal and nuclear plants are not designed to ramp up and down quickly or frequently, they would likely be retired (this is already happening for nuclear in Germany), and there would then be a need for more natural gas plants. In any case, because of the intermittency of renewables, for the foreseeable future there will be a need for natural gas back-up plants in case of unexpected weather events.

The Citigroup report concludes that “the requirement for peaking power rises as renewable penetration increases,” so “gas-fired power is not only compatible with renewables, it is in many ways essential for its large-scale adoption.”
There are actually opportunities to integrate natural gas and renewable energy technologies at many levels, from tightly coupled hybrid technologies to more loosely coupled integrated system and market designs. A report[2] by the U.S. National Renewable Energy Laboratory makes recommendations for potential integration platforms between natural gas and renewable energy technologies, including:
  • Hybrid technology opportunities and systems integration. Broader complementarities of natural gas and renewable energy technologies can be realized through co-optimized system integration to minimize drawbacks of individual technologies.
  • Power sector market design. Collaborative development of electricity market structures and regulations, coordination of daily operations, and joint transmission planning can optimize the use and abilities of natural gas and renewable energy technologies.
The International Energy Agency has argued[3] that natural gas cannot, on its own, provide a solution to the climate change challenge, as a massive transfer from coal to gas power plants is not, by itself, sufficient to keep global temperature rise below the 2°C target.  Massively-scaled up renewable energy is essential as well. But these can—indeed must—be complementary.  The key challenge is to design and implement policies that optimize the development of both shale gas and renewable energy to seize the potential synergy between them that puts us on a sustainable energy path, and more quickly.

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