Monday, April 1, 2013

An Atlantic Tale Of Gas And Coal: US Carbon Emissions Drop 3.8% But UK Emissions Surge 4.5%

During 2012, carbon emissions headed in opposite directions on the different sides of the Atlantic.  In the United Kingdom, carbon emissions jumped 4.5% in 2012, and here is why:

"The UK's emissions of climate-warming gases surged in 2012, as cheap coal replaced gas in power stations."  Natural gas costs 2 to 3 times more in the UK than the US.  A major reason for the higher gas price in the UK is that it, until recently, had a moratorium on shale gas production.  Now that the UK has lifted its shale gas moratorium, shale gas production could begin there within 5 years.

Meanwhile, in the USA that unlike the UK has had massive shale gas production, carbon emissions dropped 3.8%.  In America, the massive new gas supplies crashed the price of gas and allowed cheap, lower carbon gas to replace large amounts of more expensive coal and oil at power plants and in the economy.

Carbon emissions going down in the USA but up in the UK are a lesson in the power of markets. Rising carbon emissions in the UK vividly underline what happens currently around the world when gas is made expensive.

Even in countries committed to expanding rapidly renewable energy, as the UK is, when gas is made expensive, coal use rises and so do carbon emissions.

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