More On

Regulatory: Considering energy regulations—Natural gas

Natural gas is a preferable alternative to coal, but carries its own regulatory struggles

One of the most significant economic and geopolitical developments of the past decade has been the discovery of large quantities of recoverable natural gas in the United States. Its attractiveness from an environmental perspective and its declining relative price have made natural gas the fuel of choice for many industrial applications, including for new electric generating plants with a 50-year life expectancy. Future decisions concerning the appropriate regulation of natural gas must take into account its unique advantages as a fuel, the problems presented by its method of production and the location of newly discovered supplies in populated areas (e.g., Pennsylvania and New York).

Natural gas currently trails only coal as a fuel for U.S. electric power plants. Its value as a fuel stems from several factors. It produces approximately one-half the greenhouse gas emissions of coal, and the operational characteristics of gas-fired turbines make them the preferred choice for plants designed to generate power during times of peak demand. As increased supplies have reached market, the price of natural gas has declined recently in both relative and absolute terms, leading to the substitution of natural gas for coal as the fuel of choice for new generating facilities. On the other hand, the low price of natural gas has created economic disincentives to the development of commercially viable alternative technologies (wind and solar) that might further diminish the country’s reliance on coal, with its high carbon emissions, as our baseload power source.

author image

John Cooney

John F. Cooney is a partner in the Washington, D.C., office of Venable.

Bio and more articles

Join the Conversation

Advertisement. Closing in 15 seconds.