As California pushes to make its electricity grid carbon-free by 2045, natural gas use will persist as the state deals with economics, tech issues and above all, feasibility.
US greenhouse gas emissions fell by 2.1pc in 2019 to 5.7bn metric tonnes, a result of gas-fired generation pricing out coal. But California intends to completely eliminate emissions by replacing its natural gas consumption with increased use of wind, solar, geothermal and hydroelectric sources.
Lawmakers have mandated that at least 60pc of California's electricity must come from clean energy sources by 2030.
"If they say they want to go carbon-free it's at least theoretically possible there," geopolitical strategist Peter Zeihan told Argus. "At least in California, it might, emphasis on might, work if green tech gets a lot better."
The electrical grid in the US currently lacks advancements in energy storage and transmission needed to make California's 2045 goal a reality, he said.
The only two things that would immediately force natural gas out of the mix are a storage medium that is much better than lithium and superconductors that could take stranded energy reserve and "wire the power wherever you need to go," Zeihan said. "You'd still have to do mass manufacturing and buildout. You're talking about a huge transition process."
California is one of the prime states for that process, with a large portfolio of sun, wind and hydro energy to draw from. But the state needs more energy than these sources are currently providing.
Despite its mild climate and energy-efficiency programs, California's total energy consumption is the second-highest in the US, according to the US Energy Information Administration (EIA).
About 2.1 Tcf (59bn m³) of natural gas was consumed in California in 2017 according to the EIA. Consumption of hydroelectricity, biomass consumption and "other renewables" all combined to formthe equivalent ofabout 1.1 Tcf for the same period.
The ability to increase renewable output improves as technology does, but costs and population remain. California is the most densely-populated energy market in the west US, with generation costs averaging 17.5¢/kWh in November 2019. The national average for the same period was 10.43¢/kWh according to EIA data, while Texas, the largest deregulated market for electricity in the US, averaged 8.7¢/kWh.
The push for wind and solar energy is driven by legislation over economics. Several cities in California passed ordinances in 2019 prohibiting natural gas service in new, residential or government-owned buildings, including Berkeley, San Jose and others. California has incentives to encourage the adoption of renewable technology, but moves to ban natural gas pose a risk where renewables have not or cannot make up the difference, especially during evening peak demand times.
The state also has yet to say what it will do with its existing natural gas infrastructure, including power plants, storage sites and miles of pipelines.
In response to the increased legislative moves from cities, the California Public Utilities Commission (CPUC) issued an order in January, saying it intended to outline by 2022 how California could transition away from natural gas while maintaining safe and reliable energy supplies.
The California Independent System Operator (CAISO) also said it is working on the state's renewable energy objectives, but currently CAISO is forced to curtail renewable electricity oversupply during peak daytime hours. CAISO has listed energy storage and expansion of the regional energy market as two of the primary solutions it still needs.
Nuclear energy is not part of the criteria for California's plan, as last month Pacific Gas & Electric (PG&E) reached an $3.9bn agreement with government officials on total costs for PG&E to shut down the 2,240MW Diablo Canyon nuclear power plant, the last nuclear plant in California, by 2025.
Even if California or the Pacific region at large manages to make renewable electricity cost-effective, the carbon-free solution will not be applicable for the rest of the US. The Pacific coast's wind, hydro, geothermal and solar energy profile is in stark contrast to other population-dense areas of the US, especially the northeast.
