The three trends cutting US emissions
- 05 Feb 2013, 12:00
- Ros Donald
The US's energy sector emissions went down by a
pretty impressive 13 per cent between 2007 and 2012, according to
new analysis, reaching their lowest level since 1994. What's behind
it? Energy efficiency, gas and renewables.
US emissions
Bloomberg New Energy Finance's
Sustainable Energy in America Factbook
2013 tracks what it calls a revolution in the US energy
sector, leading to an "about face for the country's emissions
trajectory".
In its story on the research,
the Guardian led on the contribution of
energy efficiency and the US's renewables sector to the dip in
emissions, but the Bloomberg report also credits an increase in
gas-powered generation, with cheaper unconventional gas making it
economic to switch away from more polluting coal.
Both renewables and natural gas are increasing their
share in the US energy mix, while coal and oil have significantly
declined, according to Bloomberg.
So what's driving the US energy revolution?
Efficiency
Energy efficiency is one of the report's big stories.
Advances in the sector have largely driven a whopping 6.4 per cent
drop in total energy use between 2007 and 2012, according to
Bloomberg's preliminary estimates.
The report says the introduction of smart grid
technologies are helping to improve grid management - 46 million
smart meters have been deployed in the US, and spending on smart
grid rollouts grew from $1.3 billion in 2008 to $4.3 billion last
year.
Demand response capacity - the ability
to cut
down on electricity consumption at peak times - has grown by
"more than 250 per cent between 2006 and 2011", Bloomberg
says.
The biggest energy reduction came from sectors
outside electricity, Bloomberg says. The increasing popularity of
smaller, more economical vehicles mean oil consumption has gone
down since 2005. And buildings are also becoming increasingly
efficient. For example, Bloomberg says commercial buildings' energy
intensity decreased by over 40 per cent since 1980. This means gas
consumption has not gone up in the housing and commercial buildings
sector, the report says.
Despite these energy use reductions, what makes the
fall in emissions perhaps more remarkable is that GDP has actually
gone up by three per cent since 2008 , as the tables below
show:
Gas
According to Bloomberg, natural gas provided the US
with 27 per cent of its total energy supply in 2012. Gas produced
31 per cent of US electricity in 2012 - that's up from from 22 per
cent in 2007.
Even though total energy consumption is down, gas use
is on the rise. It's the huge increase of shale gas in the
country's energy mix that has helped keep prices low. As natural
gas production in the US has grown by around 14 billion cubic feet
a day, or around 25 per cent over the past five years, "demand has
struggled to keep up".
Gas generation looks set to continue to replace coal.
According to Bloomberg, Environmental Protection Agency rules requiring coal stations to install
expensive new equipment to reduce their emissions will force huge
numbers of coal plant into retirement. Bloomberg predicts that coal
is on the way out - gas-fired generation stands to almost
completely take the place of retired coal plants.
Gas still emits carbon dioxide, but it emits about
half the amount that coal does. So even though the amount of carbon
dioxide emissions from gas has increased in 2011, coal's demise has
"more than offset" this rise, Bloomberg says. The graph below shows
how this works:
Renewables
Meanwhile, renewables including hydropower supplied
9.4 per cent of total energy and 12.1 per cent of electricity in
2012 - very roughly a third of the amount produced by gas.
According to Bloomberg, renewables were the largest
source of new capacity, with 17 gigawatts added to the grid last
year, the majority of which came from wind power. Cumulative
installed renewable capacity nearly doubled between 2008
(44GW) and 2012 (86GW).
Renewables and energy efficiency also attracted a
fair amount of investment in 2012 - $44.2 billion in 2012, although
that's a 32 per cent decline on 2011.
What's causing the dip?
There's been a fair amount of speculation about
whether shale gas is behind the dip in US emissions or not. A
recent
Guardian piece lays out the competing
arguments:
"In May, the International Energy
Agency claimed that annual US emissions fell by 1.7% in 2011 "
primarily due to on-going switching from coal to
natural gas in power generation and an exceptionally
mild winter." The coal-to-gas switch has been driven by gas prices
that are falling due to large volumes of shale gas. But a new analysis of US government energy data by
Greenpeaces's upcoming energy news site, Energydesk
shows renewable energy in fact played a bigger role than gas in
cutting climate-warming gases."
But Bloomberg's analysis appears to show that both
renewables and gas played an important role in the emissions
reduction - with an important contribution from energy efficiency,
which often gets forgotten in the frenzy to compare energy
generation technologies.
Grant McDermott at the Norwegian School of Economics,
who writes for climate and energy economics blog REConomics, says:
"[The report] undeniably supports
that notion that gas has played a significant part in the reduction
of US emissions - even if that role seems to have been overstated
by some pundits."
Given the shift to shale gas, commentators such as
economist
Dieter Helm have highlighted the fact
that the US is managing to reduce its emissions without a clear
countrywide climate policy. But as we wrote last year, other
pundits have warned US emissions could just as easily go up again if the market
changes and there are no policies to block a move back towards
coal.
US coal: Under-priced, over-carbonated, and
over here
Meanwhile, on this side of the Atlantic 2012 was a
very different year for EU emissions.
In contrast to the US, last year saw greenhouse gas
emissions from Europe's coal stations go up by as much as 17 per
cent, again according to Bloomberg New Energy Finance in the
Financial Times yesterday. In
total, emissions from Europe's power sector are expected to have
increased by three per cent, the article says.
Bloomberg spokesman Brian Potowski told the
FT:
"I would say that the increase in
power emissions is due in large part to the increased
attractiveness of burning coal relative to gas in 2012."
The new statistic highlights one of the rather less
beneficial results of the change in the US's energy mix - a
significant increase in the amount of coal the country exports
around the world.
But as we wrote yesterday, if coal really is
driving the increase in EU emissions, the trend may not continue
for long. This is mostly due to regulations similar to those in the
US that will lead to the retrofitting or retiring of many of the
EU's coal stations. Europe's cap and trade system means that even if coal
use spikes over a couple of years, total emissions can't go up too
much, according to McDermott - so even though the EU ETS is
currently experiencing low carbon credit prices, climate policies
may yet help to mitigate the worst effects of the EU's dirty fling
with coal.
Good news? Perhaps. Overall, it doesn't look like
much is going to stop the
general fall in rich countries'
emissions. But what goes for the US and the EU probably doesn't for
the rest of the world. With India and China in particular
enthusiastically embracing coal, a
dramatic rise in poorer countries' emissions as they grow their
economies seems unstoppable - for the moment.
Update 07/02/2013: We've amended the first paragraph
to clarify that the reduction in emissions occurred between 2007
and 2012. It originally said the dip had occurred last year.