Energy
Biden’s Mad War On Natural Gas Will Not End Well For Americans
From the Daily Caller News Foundation
Even as the Biden administration’s regulatory agencies are moving to render the building of new natural gas power plants too costly to justify, a consensus has formed in the analyst community that the added power demands from AI will require a big expansion of natural gas generation to ensure grid stability.
Over a span of less than 20 days in April and May, Biden regulators at the Environmental Protection Agency(EPA) and the Federal Energy Regulatory Commission(FERC) published new regulations that, according to grid expert Robert Bryce, add more than 1 million words targeting natural gas to the federal register.
On April 25, the EPA finalized new power plant emission rules that will essentially force the retirement of America’s remaining coal-fired power plants by 2030 by rendering them too costly to continue operating. Most media reports focused on that aspect of the new regulations, which had been anticipated.
Reporters gave less attention to the fact that the new rules also constitute a clear effort to make it nearly impossible to finance and operate additional gas-fired power plants over the same time. The requirement that new gas plants be accompanied by costly carbon capture and storage (CCS) capability adds millions in additional costs and would also consume as much as 30% of the power generated by the plants, greatly diminishing their profitability. The fact that some operators have already tried and failed to add CCS to at least five such plants in the United States leads to an almost inevitable conclusion that this rule is intentionally structured to shut down the natural gas power industry in this country.
On May 13, the FERC rules added hundreds of thousands of more words targeting natural gas with its Order 1920. Where the EPA rules make it vastly more expensive to build and operate natural gas power plants, FERC Order 1920 makes it more costly and difficult to permit transmission lines needed to carry their electricity to market. FERC does this by discriminating between generation sources, streamlining and incentivizing permitting for power lines that are connected to wind and solar projects.
It is a regulatory pincer move designed to force generation companies to invest in wind and solar to the exclusion of natural gas generation, one that Bryce says “will strangle AI in the crib.” Rapidly expanding power loads will require a generation source that is reliable 24 hours, seven days each week, one that can be rapidly dispatched to meet demand surges that take place every day. Only natural gas can reliably fill that breach.
A series of recently published analytical studies support Bryce’s case. A Goldman Sachs analysis published in mid-May estimates that natural gas is the most fit generation tech to meet about 60% of the incremental demand load by 2030. Tudor Pickering & Holt estimates that meeting the new demand could require the building of as much as 8.5 bcf/day of new natural gas generation capacity over the same time frame.
Bryce quotes from a Morningstar report that pegs the additional gas demand at 7 to 10 bcf/day. He also refers to an Enverus study that concludes that power demand from AI and other data centers will double by 2035, requiring an additional 4.2 bcf/day of new natural gas generation by that time for their needs alone.
“This type of need demonstrates that the emphasis on renewables as the only source of power is fatally flawed in terms of meeting the real demands of the market,” Richard Kinder, executive chairman of pipeline operator Kinder Morgan, told analysts during the company’s first-quarter earnings in April, as reported by CNBC.
Seldom do we see a consensus so broad and diverse as this emerge on any topic in the energy space, yet the Biden regulators at EPA, FERC and other relevant agencies appear to be impervious to having their green energy fantasies interrupted by such pesky realty. They have one goal, which is to finalize as many new regulations negatively impacting the coal and oil and gas industries as possible before time runs out on the administration’s first term.
In that mad rush to consolidate authoritarian control, any and all inconvenient facts are to be ignored. This will not end well.
David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
From the Fraser Institute
In case you haven’t heard, the Trudeau government has proposed a new set of “Clean Electricity Regulations” (CERs) to purportedly reduce the use of fossil fuels in generating electricity. Basically, the CERs would establish new standards for the generation of electricity, limiting the amount of greenhouse gases that can be emitted in the process, and would apply to any unit that uses fossil fuels (coal, natural gas, oil) to generate electricity.
The CERs would hit hardest provinces that rely on fossil fuels to generate electricity: Alberta (89 per cent fossil fuels), Saskatchewan (81 per cent), Nova Scotia (76 per cent) and New Brunswick (30 per cent). Not so much Ontario (7 per cent) and Quebec (1 per cent), which are blessed with vast hydro potential.
In theory, the government has been in “consultation” with electricity producers and the provinces that will be most impacted by the CERs, although some doubt the government’s sincerity.
For example, according to Francis Bradley, CEO of Electricity Canada, which advocates for electricity companies, there is “insufficient time to analyze and provide feedback that could meaningfully impact the regulatory design” adding that the “engagement process has failed to achieve its purpose.” And consequently, the current design of the CERS may impose “significant impairments to the reliability of the electricity system and severe affordability impacts in many parts of the country.”
This was not the first time folks observed a lack of meaningful consultation over the CERs. Earlier this year, Alberta Environment Minister Rebecca Schulz told CBC that an update to the CERs made “no meaningful corrections to the most destructive piece of Canadian electricity regulation in decades” and that CERs “would jeopardize reliability and affordability of power in the province.”
Simply put, with CERs the Trudeau government is gambling with high stakes—namely, the ability of Canadians to access reliable affordable electricity. Previous efforts at decarbonizing electrical systems in Ontario and around the world suggest that such efforts are relatively slow to develop, are expensive, and are often accompanied by periods of electrical system destabilization.
In Ontario, for example, while the provincial government removed coal-generation from its electricity generation from 2010 to 2016, Ontario’s residential electricity costs increased by 71 per cent, far outpacing the 34 per cent average growth in electricity prices across Canada at the time. In 2016, Toronto residents paid $60 more per month than the average Canadian for electricity. And between 2010 and 2016, large industrial users in Toronto and Ottawa experienced cost spikes of 53 per cent and 46 per cent, respectively, while the average increase in electric costs for the rest of Canada was only 14 per cent. Not encouraging stats, if you live in province targeted by CERs.
Reportedly, the Trudeau government plans to release a final version of the new CERs rules by the end of this year. Clearly, in light of the government’s failure to meaningfully consult with the electrical-generation sector and the provinces, the CERs should be put on hold to allow for longer and more sincere efforts to consult before these regulations go into effect and become too entrenched for reform by a future government.
Otherwise, Canadians may pay a steep price for Trudeau’s gamble.
Author:
Haulage bridge at Cando Rail & Terminals’ Sturgeon Terminal in Alberta’s Industrial Heartland, near Edmonton. Photo courtesy Cando Rail & Terminals
From the Canadian Energy Centre
By Will Gibson
Cando Rail & Terminals to invest $200 million to support Dow’s Path2Zero petrochemical complex
A major rail hub in Alberta’s Industrial Heartland will double in size to support a new carbon-neutral plastic production facility, turning the terminal into the largest of its kind in the country.
Cando Rail & Terminals will invest $200 million at its Sturgeon Terminal after securing Dow Chemical as an anchor tenant for its expanded terminal, which will support the planned $8.9 billion Path2Zero petrochemical complex being built in the region northeast of Edmonton.
“Half of the terminal expansion will be dedicated to the Dow project and handle the products produced at the Path2Zero complex,” says Steve Bromley, Cando’s chief commercial officer.
Steve Bromley, chief commercial officer with Cando Rail & Terminals.
By incorporating carbon capture and storage, the complex, which began construction this spring, is expected to be the world’s first to produce polyethylene with net zero scope 1 and 2 emissions.
The widely used plastic’s journey to global markets will begin by rail.
“Dow stores their polyethylene in covered railcars while waiting to sell it,” Bromley says.
“When buyers purchase it, we will build unit trains and those cars will go to the Port of Prince Rupert and eventually be shipped to their customers in Asia.”
A “unit train” is a single train where all the cars carry the same commodity to the same destination.
The expanded Cando terminal will have the capacity to prepare 12,000-foot unit trains – or trains that are more than three-and-a-half kilometers long.
Construction will start on the expansion in 2025 at a 320-acre site west of Cando’s existing terminal, which 20 industrial customers use to stage and store railcars as well as assemble unit trains.
Bromley, a former CP Rail executive who joined Cando in 2013, says the other half of the terminal’s capacity not used by the Dow facility will be sold to other major projects in the region.
The announcement is the latest in a series of investments for Cando to grow its operations in Alberta that will see the company spend more than $500 million by 2027.
The company, which is majority owned by the Alberta Investment Management Corporation previously spent $100 million to acquire a 1,700-railcar facility in Lethbridge along with $150 million to build its existing Sturgeon terminal.
Cando Rail’s existing Sturgeon Terminal near Edmonton, Alberta. Photo courtesy Cando Rail & Terminals
“Alberta is important to us – we have 300 active employees in this province and handle 900,000 railcars annually here,” Bromley says.
“But we are looking for opportunities across North America, both in Canada and the United States as well.”
Cando released the news of the Sturgeon Terminal expansion at the Alberta Industrial Heartland Association’s annual conference on Sept. 19.
“This is an investment in critical infrastructure that underpins additional growth in the region,” says Mark Plamondon, the association’s executive director.
The announcement came as the association marked its 25th anniversary at the event, which Plamondon saw as fitting.
“Dow’s Path2Zero came to the region because of the competitive advantages gained by clustering heavy industry. Competitive advantages are built from infrastructure that’s already here, such as the Alberta Carbon Trunk Line, which transports and stores carbon dioxide for industry,” he says.
“Having that level of integration can turn inputs into one operation into outputs for another. Competitive advantages for one become advantages for others. Cando’s investment will attract others just as Dow’s Path2Zero was a pull for additional investment.”
Argentina President Javier Milei rejects UN’s ‘socialist’ ‘Pact for the Future’
Some dockworkers earn more than $400,000 a year
‘Total Failure’: Shocking Data On Criminal Migrants In US Highlight Harris’ Border Hypocrisy, Former ICE Official Says
Employer Vaccination Mandates Under Scrutiny Post COVID-19
Rep. Paul Gosar introduces bill to end vaccine manufacturer immunity from injury lawsuits
Israeli Airstrike In Beirut Kills Hezbollah Leader Hassan Nasrallah
Elon Musk’s X Set to Reboot in Brazil After Final Fine Payment
-
Alberta1 day agoDanielle Smith delivers on promise to protect gender-confused children in Alberta
-
COVID-192 days agoWill We Fall For The Same Old PCR Tricks Again?
-
Brownstone Institute1 day agoJohn Kerry and the Circuitous Assault on Free Speech
-
Daily Caller2 days agoBureaucrats Worry Democracy Will Get In The Way Of Their Climate Agenda
-
Alberta1 day agoChris Scott and Rebecca Ingram attempting Class Action Lawsuit against Province for COVID restrictions
-
Alberta8 hours agoProvince overhauls Victim Services model, creating regional hubs and full access
-
National1 day agoChurch fire on Canadian indigenous land on National Day for Truth and Reconciliation
-
Economy21 hours agoTaxpayer watchdog warns Canadians to fight against ‘guaranteed income schemes’