What’s the issue?
The move toward a net-zero goal by 2050 for the entire U.S. economy (and worldwide) has taken on a life of its own. Regardless of changes in the political winds in Washington as companies commit and investors demand a strategy for achieving that or very similar goals, our nation’s existing 200,000 miles of gas pipeline infrastructure could be well-positioned to play an integral role.
Why does it matter?
While FERC Chairman Glick regularly claims that climate change is an existential crisis for the planet, decarbonization may, in fact, be an existential crisis for pipeline companies if they cannot find a way to quickly reimagine their role in a net-zero economy.
What’s our view?
For pipeline companies, an inspirational strategy and detailed plan exists outside the U.S. The gas transmission company for New Zealand has laid out a detailed plan to evolve by enabling the country’s conversion to hydrogen, which preserves a robust role for its assets. The company’s plan recognizes that as the transmission pipeline, it can play a central role in preserving the need for pipeline infrastructure by diversifying its vision beyond delivering only natural gas. It also recognizes that its plans need to start “straightaway” if it is to survive. We suggest that U.S. pipelines can play a similar role in this country and use New York state as an example.
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