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Efficiency Drove U.S. Emissions Decline, Not Natural Gas, Study Says

Conventional wisdom says switching to natural gas is why CO2 fell last year, but a recent analysis found a different explanation.

Jul 30, 2013

Aggressive energy efficiency efforts by households, companies and motorists led to the decline in carbon dioxide emissions from energy use in the United States, according to a recent report. The controversial finding contradicts recent studies that say the power sector's shift away from coal to cheap natural gas caused the bulk of reductions.

U.S. emissions last year fell by 205 million metric tons, or 4 percent, from 2011 levels. CO2 Scorecard Group, a small environmental research organization, says that nearly half the decline came from energy-saving measures such as retrofits and smarter appliances in homes and offices, as well as from Americans driving fewer miles, and using more fuel-efficient vehicles. 

Natural gas is responsible for only about one-quarter of last year's emissions drop, CO2 Scorecard Group asserts. 

"Everybody started to believe that shale gas is driving all these CO2 reductions," said CO2 Scorecard chief executive Shakeb Afsah, an environmental economist and co-author of the study. After investigating, he said he and colleagues found that "the numbers just don't add up."

Indeed, the report challenges a common belief that America's dramatic natural gas boom—made possible by the hydraulic fracturing, or fracking, of shale gas wells—is the main factor in the decline of energy-related emissions. And it goes against other recent studies, including those by the International Energy Agency, the Breakthrough Institute and former Pennsylvania environment secretary John Hanger, that made that argument.

Shale gas now represents 30 percent of U.S. natural gas supplies, up from one percent a little over a decade ago. The surge in production has pushed gas prices to historic lows, leading utilities increasingly to choose it over coal. Natural gas supplied just under one-third of U.S. electricity last year, up from 16 percent in 2000, while coal-fired electricity dropped from half to about 36 percent over the same period. 

Natural gas, which is primarily methane, produces about half the CO2 of coal when combusted. But leakage of methane—a more powerful, though shorter-lived greenhouse gas—throughout the production and distribution systems cancels out some of those gains. (To what extent isn't clear.) On average, electricity from natural gas is many times more carbon-intensive per unit than wind or solar.

Concerns about air and water pollution from fracking have put natural gas squarely at the center of America's energy debate. President Obama and his energy officials have embraced natural gas as a key fuel for combating climate change. Environmentalists and clean energy advocates have more mixed opinions on the natural gas boom, however, with some groups touting its short-term climate benefits and others calling for a moratorium at least until they're satisfied drilling can be done safely.

In their report, the CO2 Scorecard authors write that the impact of natural gas on emissions has been overstated. One reason is that natural gas replaced not only coal last year; it also substituted for much lower-carbon hydroelectric, nuclear and solar power. Secondly, natural gas-fired generation rose in factories, refineries and other non-utilities, canceling out a portion of the coal-related reductions.

The research note was the result of about three months' worth of work by Shakeb Afsah who did the bulk of the data analysis. Kendyl Salcito, the group's policy communications specialist, wrote up the findings. CO2 Scorecard Group doesn't accept outside funding; it is supported by the research and development budget of Afsah's consulting firm, Performeks LLC, which advises governments on environmental rating and disclosure programs.

Afsah explained that his report came up with different numbers than other studies in part because most analyses of electricity-related emissions rely on national-level data. 

The CO2 Scorecard report, by contrast, examined changes in electricity at the regional level using data from grid operators, which showed researchers greater detail about where natural gas had replaced coal or renewables; where renewables replaced coal; and where electricity consumption simply declined because of reduced demand.

The report "is one of the few to look at things in this way," said Jonathan Koomey, a research fellow at the Stanford University's Steyer-Taylor Center for Energy Policy and Finance, who advised the authors prior to the study's release. "You're going to get a different picture than if you look at the system as a whole." 

Even if CO2 Scorecard is correct that the effect of natural gas on emissions has been less than previously believed, delivering one quarter of U.S. carbon cuts is still "pretty significant," said Michael Tubman, a senior fellow at the Center for Climate and Energy Solutions (C2ES), a nonprofit policy organization.

"We shouldn't just say that's not important," because it's less than others have found, he said.

Tubman co-authored a recent C2ES report called "Leveraging Natural Gas to Reduce Greenhouse Gas Emissions," which recognized natural gas as a short-term climate solution but called for more aggressive policies and investments to promote zero-carbon sources like renewables over the long haul.

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