Natural gas proponents have long framed it as a “bridge fuel” for meeting rising energy demands, while decreasing utilities’ dependence on carbon-intensive coal. Unfortunately, the power sector is now more focused on extending the natural gas bridge than crossing it. In the last two years, 27 new natural gas power plants have come online in the United States, deepening our dependence on fossil fuels and jeopardizing the Paris Agreement’s goal of net-zero emissions by 2050.

While natural gas will remain part of the interim energy mix, investment in new natural gas infrastructure raises red flags due to its long lifespan. Combined-cycle gas turbines typically last 25 to 30 years and gas furnaces can last 15 to 20 years. The longevity of these carbon-intensive assets conflicts not only with the Paris goal but also the related U.S. goal to generate 100-percent clean electricity by 2035. Cities and states, on the front lines for climate impacts, are beginning to introduce bans on gas appliances in new buildings. California’s ban on natural gas furnaces and heaters starts in 2030.

A gas-fired power plant installed this year will likely have to be decarbonized long before its useful life ends, posing the transition risk of stranded assets. Given this risk, why are utilities investing in new natural gas infrastructure?

Many companies in the natural gas value chain are betting on green hydrogen to replace natural gas use in existing infrastructure, which could preserve their business models and delay the need for investment in electrification and clean energy sources. Some utilities are even looking to couple green hydrogen with other developing but high-cost technologies like renewable natural gas (RNG) and carbon capture and storage (CCS), which have no current pathway for scalable and affordable use, despite decades of development.

While green hydrogen does hold promise for industrial applications and energy storage, it is not yet a practical solution for electric utilities and natural gas distribution companies that tout its potential. Most overemphasize the potential of green hydrogen in their net-zero transition plans and fail to account for the technology’s risks. Green hydrogen is currently capital-intensive, requires extensive development of clean energy sources, lacks regulatory guidance, and poses a multitude of safety risks during transportation and storage. The International Energy Agency acknowledges these challenges and predicts hydrogen will account for 1 percent of global electricity generation by 2035.

Companies should evaluate various decarbonization strategies, but hydrogen and other new technologies are far from maturity and unlikely to contribute to the emission reductions required for 1.5ºC -alignment or meet consumers’ need for affordable energy. Companies in the natural gas value chain must produce comprehensive assessments of the economic and technological challenges of green hydrogen, RNG and CCS, and the risks of relying on these technologies to reach interim and long-term 1.5ºC targets. To this end, As You Sow is engaging multiple companies on feasible climate transition plans for their natural gas infrastructure and has filed related proposals with power utilities CenterPoint Energy, DTE Energy and a producer of natural gas turbines, General Electric.

Kelly Poole
Climate and Energy Coordinator, As You Sow