For this to happen, gas generation would need to be paid a higher rate than is traditionally the case, since it would be primarily used in a back-up role.
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"The reforms we are making to the electricity market through the Energy Bill and through our gas generation strategy are aimed at plugging this gap in order to keep the lights on, " he added.
Due to the concern that gas generation has grown rapidly and yet the rules for gas and power markets are different, the Federal Energy Regulatory Commission held regional hearings on market syncing issues in 2012.
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For its part, the North American Reliability Corporation (NERC), who oversees power market reliability, issued a December report highlighting that gas and power markets need to be more synchronized to effectively enable reliability in light of higher dependence on natural gas generation.
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The biggest solar thermal plant ever built is in the Mojave Desert of California and generates 80 megawatts. (The biggest single photovoltaic installation produces 12 megawatts.) Solar thermal power prices range from 11 cents to 15 cents per kilowatt-hour, making it more expensive than natural gas generation at its lowest price, around 7 cents, but less expensive during peak hours.
In the past 10 years natural gas fired generation has grown 61% while coal fired generation has shrunk by 17%, according to the US Energy Information Agency.
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In the long run, if the projections of the US Energy Information Administration are correct and gas fired generation continues to grow rapidly, then there is little question the market rules need to be modified to assure reliability and spur more pipeline capacity and flexibility.
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Not according to a new econometric study that concludes no more than 20% of existing coal generation is likely to switch over to gas, even if the Environmental Protection Agency drives up the cost of coal generation and gas prices stay at their current, low rates indefinitely.
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"Increasing the nation's use of natural gas for electricity generation could result in adverse economic consequences, " the report said, noting that natural gas prices are fickle and that fuel switching on a large scale would require regulators to approve more pipeline and storage capacity.
This discourages investors in the flexible, gas-powered generation needed to provide backup for windless, cloudy days.
Today, natural gas dominates the generation mix, with its share just over 50%.
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By contrast, coal- and natural gas-fired generation systems are fairly mature technologies.
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Coal, which has led the recent surge in global energy demand, will continue to be cheaper than natural gas for electricity generation.
Hess also predicted a wholesale shift toward natural gas in electricity generation.
So when you develop the wind, you can then remove natural gas from power generation and put it into a transportation fuel market.
China is already investing billions of dollars to substitute hydropower (which counts as a renewable energy source) for coal and gas in electricity generation.
And gas-fired generation will also likely play a role, as it can be quickly ramped up and down in response to the vicissitudes of wind.
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Last year, for example, an earthquake in Japan forced the closure of several nuclear plants, leading to a surge in demand for gas for power generation.
Since gas-fired generation is about the most scalable, efficient, flexible, clean and (on a large scale) lowish-carbon form of electricity available, it is going to prove economically and politically attractive.
The additional nuclear power plants would also have the advantage of being less vulnerable to fuel price changes than coal or gas-fired generation, helping to enhance the security of electricity supplies.
The markets are perfectly capable of winnowing things out on their own, and have already created a dramatic reduction in US greenhouse gas emissions thanks to the increased use of natural gas in power generation.
At The Arora Report, our analysis leads us to believe that adoption of natural gas for power generation in the United States will grow faster than the consensus and demand for coal will fall more than the consensus.
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While other factors, including a sluggish U.S. economy and increasing energy efficiency, have contributed to the decline in carbon emissions from factories, automobiles and power plants, many experts believe the switch from coal to natural gas for electricity generation has been the biggest factor.
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According to the World Policy Institute, coal-and-oil-fired power plants consume roughly twice the water than that of gas-fired facilities while nuclear generation needs three times that of natural gas.
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It is also postponing further investment in gas-fired electricity generation until at least 2015.
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The growing worldwide demand for energy is raising demand for gas turbines and power generation equipment manufactured by GE.
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The 50% decline in gas prices since 2008 implies an increase in gas-fired electricity generation of a bit more than 3%.
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The problem with using natural gas for electric power generation displacing coal is that it is misuse of our natural resources.
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Coal: Coal is our most abundant energy resource and therefore should not be shunned in favor of natural gas for electric power generation.
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The U.S. Energy Information Agency (EIA) estimates that natural gas consumption for power generation will be 83% higher in 2030 compared to 2009.
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