COP26 Confirming Expectations - A Growing Role for Gas in Generation, but Not for LDCs

Originally published November 5, 2021

What’s the issue?

COP26 just began this week in Glasgow, Scotland and already our two predictions about the outcome of that meeting have been proven true, at least with respect to the plans of the U.S. as announced by President Biden.

Why does it matter?

First, as we expected, a focus for the near-term will be on methane emissions, as President Biden announced his administration’s intent to begin regulating those emissions from the oil and gas industry. Second, as we expected, the Biden administration’s plans for reaching net-zero by 2050 are sure to displease the environmental purists in his party, as his plans essentially suggest a far broader solution than just wind, solar and batteries.

What’s our view?

The plans laid out in President Biden’s announced long-term strategy for reaching net-zero by 2050 provide for a substantial role for natural gas as a fuel for electric generation. However, the plans also call for completely eliminating it as a fuel for use in commercial and residential buildings, including as a fuel for home cooking. The elimination of such demand would call into question the continuing need for local gas distribution companies. As a result, the efforts to support hydrogen as a commercial and residential fuel need to increase dramatically to keep those companies and the pipelines that they own relevant.

 



Want the full article? We'll email it to you.

Recent Articles

November 4, 2021

Can the President Use the Defense Production Act to Combat High Oil and Gas Prices?

November 11, 2021

COP26: What Is at Stake?

November 23, 2021

It’s Infrastructure Week and Money is on the Table for Existing Pipeline Companies