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Gas-Fueled Power Generation Likely to Grow Along with Renewables for Decades to Come

In the race to reduce carbon footprints and replace coal as a primary energy source, much has been made of an alleged “battle” between natural gas and renewables in the power generation industry. However, an astute market read — fueled by actions from utilities and regulatory agencies – may find the two sectors growing in conjunction for decades to come.

Some of the recent changes that impact the market share of each sector include the rise of microgrids and gas-fueled generation, moves by utilities to position natural gas alongside renewables in balanced portfolios, and recent regulatory mandates.

“The prospects for natural gas in this ‘race’ brighten considerably when one considers that natural gas is no slouch when it comes to distributed energy,” said Alap Shah, Director of Technologies in Black & Veatch’s Power business. “Natural gas-fueled microgrids and microturbines, which are beginning to find use by large manufacturers as a legitimate and low-carbon footprint power source, are entering service and, in some cases, relegating the main grid to backup-source status.”

Momentum is building across the natural gas industry for distributed energy resources, according to the 2015 Black & Veatch Strategic Directions: U.S. Natural Gas Industry report. More than two-thirds of natural gas service providers viewed the growth of natural gas distributed energy resources as an opportunity to grow their business. Only 7.8 percent viewed this as a threat to their business.

 

@black_veatch