Have We Seen the Pinnacle Of CO2 Emissions?

smokestackThere is some reason for optimism for those of us who are concerned about greenhouse gas emissions. Most people, if asked, would probably tell you that despite years of public attention on the problem, CO2 emissions continue to go up. But we may have experienced peak carbon emissions five years ago.  The Energy Information Administration reports 2007 as the highest year on record for CO2 emissions, with levels of new emissions actually lower since then.  The levels of that year may never be seen again.

Historically, emission levels have followed the economy. Healthy economies promote all of the types of activities that tend to drive CO2 emissions. But 2008 brought a sudden and dramatic stop to a near decade long economic expansion. In keeping with historical patterns, CO2 emissions went down as economic activity slowed.

It would be reasonable to assume then that the levels of carbon emissions would recover along with the economy. But that isn’t happening. The reason may be surprising. Electricity production has long been a major source of CO2. But the trend toward cleaner sources of electricity is offsetting increased electricity usage resulting from a recovering economy.

Increasingly coal, long the preferred fuel for creating electricity in the U.S., has been coming under market and regulatory pressure. As a result, fewer coal based facilities are being built. In their place the market is choosing natural gas and renewable sources. Natural gas burns cleaner than coal resulting in few emissions per kilowatt. Absent a significant change in the political landscape, environmental regulations will continue to add to the cost of doing business for coal.

The math works out such that total emissions will go down even though economic growth means we will be using more and more energy over the coming years. If you live in Texas, for example, less than half of your electricity now comes from coal. Texas electric providers now get their power largely from natural gas burning power plants.

Texans appreciate the switch to natural gas more than most people considering the state has become the center of the natural gas revolution made possible by fracking technology. Texas has done its part to help flood the market with cheap natural gas driving down prices.

Dig a little deeper into the EIA projections and you may find even more room for cautious optimism. The authors of the report did not account for the potential impact of any major advances in renewable energy technology. Given the pace of technological innovation in all fields over the last 2 decades, it’s hard to discount the possibility of a potential game-changing breakthrough in energy at some point in the next 20 years.

 

Article first published as Have We Seen The Pinnacle Of CO2 Emmissions on Technorati.

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I have been associated with the energy industry for almost 20 years, first as a Market Maker for some of the largest energy companies in the world, and then as an energy consultant to commercial and industrial businesses of all sizes.

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