Based on the recent proposal by the European Commission (EC) to label natural gas and nuclear power as ‘Green’ energy sources as part of the European Union’s (EU) classification scheme for energy investments, it is worth considering whether natural gas and nuclear power stand a chance to be considered as ‘Green’ energy sources.
The EC contemplates that there is a role for natural gas and nuclear to facilitate the transition towards a predominantly renewable-based future. If approved, it is posited that the label will apply to industries that generate about at least 80% of all Greenhouse Gas (GHG) emissions in the region.
The EC’s proposal may have been occasioned by heightened energy demand which non-fossil fuel based energy sources/renewable resources are unable to meet in the short term, thus spurring an increase in energy prices or also because of the variable and intermittent nature of renewable resources in grid integration plans with insufficient storage capacity to address short term back up requirements, thus necessitating the need for increased base load capacity best served by conventional power generation dispatchable technologies (baseload power refers to the minimum amount of electric power needed to supply the electrical grid at any given time).
Nevertheless, before delving deeper, it is worth defining ‘Green energy’ as it is usually used interchangeably with ‘Clean energy’ which has a different meaning. Green energy is energy that comes from natural sources, e.g., the sun, wind, etc. Clean energy on the other hand is associated with clean air, as it constitutes energy sources that do not release pollutants into the air. ‘Renewable’ energy which is also mixed up with green and clean energy is energy that can be replenished, e.g., hydropower, wind power, solar energy. These definitions are important in understanding the role of several energy sources in making progress with the clean energy transition (shifting energy production away from sources that release a lot of GHG to those that release little or no GHG).
Where does Natural Gas and Nuclear Power stand?
Natural Gas and its status as a clean source of energy
According to Shell, natural gas is the lowest-carbon hydrocarbon, odourless and non-toxic. It is the cleanest-burning hydrocarbon, producing around half the carbon dioxide (CO2) and just one tenth of the air pollutants of coal when burnt to generate electricity. As a leading supplier of natural gas and liquified natural gas (LNG), Shell expects global demand for gas to increase by 40% from its 2014 level. Germany (a world leader in transitioning away from fossil fuels) for example, gets a significant portion of its energy not from wind farms or solar panels, but from Russian natural gas and biomass plants.
Based on information from the US Energy Information Administration (EIA), natural gas possesses a myriad of qualities that make it efficient, relatively clean burning and an economical energy source. However, the production and use of natural gas have environmental and safety issues for consideration, as it is mainly methane which has serious implications from an emissions perspective, in addition to the effects of exploration and drilling activities for natural gas, thus necessitating strict safety regulations and standards.
Nevertheless, according to the Executive Director of the International Energy Agency (Faith Birol), gas is expected to retain a major role as a source of flexibility and back-up for many years to come, especially in economies such as Europe that have large seasonal variations in demand.
Nuclear and its status as a clean source of energy
Nuclear is posited to be a zero-emission clean energy source given its power generation process that splits uranium atoms to produce energy, with the heat released by ‘fission’ used to create steam that spins a turbine to generate electricity without the harmful by-products emitted by fossil fuels. The land footprint of nuclear energy production is small compared to other sources for electricity generation. Nuclear also produces minimal waste.
In a 2019 report on ‘Nuclear Power in a Clean Energy System’ the International Energy Agency (IEA) posited that nuclear power and hydropower form the backbone of low-carbon electricity generation as they provide three-quarters of global low-carbon generation. Thus, nuclear power is viewed as the second-largest source of low-carbon electricity and contributes to electricity security in a variety of ways including providing grid stability, limiting the impacts of seasonal fluctuations in renewable energy output, reducing dependence on imported fuels, etc. According to the IEA, ‘achieving the clean energy transition with less nuclear power is possible but would require an extraordinary effort’ as nuclear can contribute to easing the technical difficulties of integrating renewables and lowering the cost of transforming electricity systems.
According to the International Atomic Energy Agency (IAEA), progress and advancements on nuclear power technologies has led to innovative, advanced, and next generation reactor designs, thus making nuclear power more efficient, affordable, and constituting an attractive option for decarbonization. The French EU Presidency views nuclear energy as vital to decarbonising European industry, meeting emission reduction targets, and enhancing its energy sovereignty and self-sufficiency.
The views of proponents and supporters alongside critics of the EC’s proposal are expressed below with names anonymized for the purpose of this write-up.
Proponents and supporters of the EC’s proposal are of the view that if decabornisation is the goal, then natural gas and nuclear must be a part of the continent’s energy mix as Europe or any other large economy cannot run solely on clean energy technologies like wind and solar, because there is no justification whether based on physics, history, or mathematics. In addition, renewables are reputationally known for their unreliability. Some believe that nuclear and gas are not ‘bridge’ fuels or ‘transition’ fuels but are the fuels of the future based on their low- or no-carbon footprints, their affordability and scalability.
Critics of the EU’s proposal on the other hand, are of the view that both sources cause damage to the environment. Nuclear power may be considered a sustainable investment if countries can safely dispose of radioactive waste, given the environmental hazards associated with nuclear plants and the safety concerns over storage. Natural gas on the other hand can be classified as a ‘transitional’ green energy source for investment purposes, if they are able to meet pre-established emissions criteria, thus replacing polluting fossil fuel plants, given the level of carbon dioxide emissions associated with burning natural gas.
Some critics have opined that Natural Gas is ‘all fossil fuels’ and there needs to be acceptance of the need for more investments in fossil fuels to tackle energy poverty, rather than refer to certain ‘dirty’ fuels as ‘green’. Others believe that our reduction of dependence on fossil fuels can only be achieved by increasing mining production. It is reported that coal demand is on the increase as electricity from coal is at new record highs. Was the world rash in its thinking of eroding fossil fuels in the twinkle of an eye?
Although the levelized cost of solar power has declined rapidly over the last decade, and the technology has strong potential for deployment at the point of use via distributed models, renewables on its own cannot achieve the required redundancy and reliability needed in clean energy systems and electricity grids. Most renewable power technologies are less capital intensive, thus requiring shorter lead times in comparison with large-scale conventional power solutions that may still have to grapple with fuel supply challenges but on the other hand possess significant economies of scale.
Nevertheless, robust renewables deal flow(s), coupled with untapped reserves of relatively clean natural gas in most regions, indicates that the future energy portfolio of particularly developing economies can be environmentally friendly. Whether grid parity will be achieved in the near future is a separate issue for discussion. What is foreseeable is that as governments cut subsidies, a larger portion of the cost of conventional power will be passed on to end users, potentially bringing renewables into more favourable light, particularly as innovation in energy storage solutions advance.
A diversified but balanced approach will ensure security of supply in general and may be poised to create reliable income for investors, particularly in developing economies with significant gaps in energy demand and supply.
It may be worth labelling both natural gas and nuclear power sources as ‘transitional’ energy sources but not ‘green’ energy sources as they do not emanate from natural sources and hence cannot be labelled as ‘green’ which would amount to what is popularly known as ‘green washing’- a false/irresponsible claim made by companies under the guise of cleaning the environment. This would clearly be at odds with the United Nations Sustainable Development Goals (SDG’s) which are of universal applicability, particularly SDG 7 (access to affordable, reliable, sustainable, and modern energy for all) and SDG 13 (climate action). The SDGs seek to end poverty in all its forms everywhere (SDG 1), with energy poverty not being an exception and seeks to promote the provision of access to justice for all (SDG 16). Therefore, energy transition strategies whether from a country-wide or an organisational standpoint must be fair and just for ALL.
Can a case therefore be made for natural gas as transition fuel across Sub-Saharan Africa, to serve as a gateway for the region to transition to a ‘renewable-based future’, albeit on a longer trajectory, and on what basis? Find out in subsequent posts.