LDC Minimus, LDC Insipidus,
LDC Robustus? Which Would You Rather Be?
Post-Order 636 evolution depends on aggressive regulatory and legislative reform.
"Get out of...
Before the express train leaves the station, it's worth taking a look at the facts about new electric generating capacity in the United States.
Natural gas has become the primary energy source, accounting for about two-thirds of new capacity during the 1990. In contrast, market share for coal-which currently accounts for over 40 percent of all online capacity, and about 55 percent of online fossil-fuel capacity-is expected to grow only 10 to 15 percent in this decade.
The overwhelming choice of gas for new units reflects, in large part, the favorable economics for constructing and operating gas-fired plants. New gas-based combined-cycle and cogeneration plants offer short construction lead times, high efficiency and reliability, extremely low pollution levels, and modular construction opportunities that other generation sources-particularly coal, even low-sulfur coal-cannot match. An increasingly favorable gas supply and competitive price outlook also contribute to make gas the fuel of choice for both utility and nonutility generating additions.
A number of studies, even pro-coal studies, acknowledge that gas plants are for more efficient and far less costly to build and operate than coal plants. The 1990 Clean Air Act Amendments certainly allow more flexibility as to how clean air standards are met, but careful analysis using life-cycle and full-cycle factors shows that in the long and short-run, in most applications, natural gas is the best fuel choice.
New long-term price projections by the Department of Energy's Energy Information Administration clearly reveal trends that will help keep natural gas cost-competitive. The only way to make coal the winner in this decade is to use outdated and unrealistic assumptions.
The American Gas Association has always seen an important role for coal in the electric generating market. The market of the 90's, however, clearly prefers natural gas. Without question, natural gas will be powering the electric train of the future.
Michael Baly is president and chief executive officer of the American Gas Association.
Articles found on this page are available to Internet subscribers only. For more information about obtaining a username and password, please call our Customer Service Department at 1-800-368-5001.