Natural gas-fired generation is king in the realm of data center development, at least for the near term. Still, hyperscalers are taking a variety of steps to mitigate the climate impact of their expanding gas use. These include adding CCS, building renewables and supporting new nuclear.
There are several approaches hyperscalers can take to mitigate the climate-related impacts of their increasing gas consumption for data centers. These include buying and retiring environmental credits; capturing and sequestering gas-plant CO2; and developing more renewables and nuclear capacity.
Many hyperscalers now acknowledge that they will rely heavily on natural gas-fired generation to power their new data centers, at least for the near term. But that conflicts with “net zero” goals, so many AI giants are moving to mitigate the environmental impact of their fast-rising gas use.
Two factors — public concern about soaring utility bills and President Trump’s strong opposition to offshore wind — are forcing New England to rethink its once-ambitious plans for a renewables-heavy electric grid and reassess how to meet its power-generation needs in the late 2020s and early 2030s. One possibility would be to expand the region’s access to piped-in natural gas, but midstreamers’ previous efforts to add pipeline capacity were beaten back time and again. In today’s RBN blog, we discuss New England’s ongoing debate about what to do next.
New England is determined to shift toward a greener electric grid, but the region’s plan to slash its current reliance on natural gas (and backup fuel oil — and sometimes coal) by ramping up offshore wind and solar (and backup batteries) has hit a seemingly immovable object. President Trump, a staunch opponent of offshore wind, on Day 1 of his second administration ordered a halt to new leases and permits and directed his Interior Secretary to review existing permits. As we’ll discuss in today’s RBN blog, those moves have left New England power planners scratching their heads, and may even resurrect the possibility of expanding natural gas pipeline capacity into the region.
Mexico’s state-owned Comisión Federal de Electricidad (CFE) and private-sector developers of LNG export terminals have been aggressively advancing new natural gas-consuming projects in Northwest Mexico. But while plans for a number of new pipelines to help bring in gas from the Permian are on the drawing board, it remains to be seen if they can be built as quickly as they would need to be to avert a potentially ugly competition for gas supplies. In today’s RBN blog, we discuss the gas-demand and gas-delivery projects now under development in Northwest Mexico.
Since the mid-2010s, Mexico’s Comisión Federal de Electricidad (CFE) has developed a massive fleet of natural-gas-fired combined-cycle plants and helped to underwrite the buildout of a far-reaching network of gas pipelines from South Texas and West Texas into and through much of Mexico. Now, there’s a big push to extend that network southeast through the Yucatán Peninsula to serve new power plants and industrial facilities there. The question is, with the vast majority of the pipeline capacity down Mexico’s East Coast already locked up, where will the Yucatán’s incremental gas come from? In today’s RBN blog, we discuss this potential disconnect between Mexico’s gas-related aspirations and reality.
With all the talk about U.S. LNG exports and plans for more LNG export capacity, it can be easy to forget that more than 6 Bcf/d of U.S. natural gas — mostly from the Permian and the Eagle Ford — is being piped to Mexico. That’s more than 3X the volumes that were being piped south of the border 10 years ago, a tripling made possible by the buildout of new pipelines from the Agua Dulce and Waha hubs to the Rio Grande and, from there, new pipes within Mexico. And where is all that gas headed? Mostly to new gas-fired power plants and industrial facilities — a handful of new LNG export terminals being planned on that side of the border will only add to the demand. In today’s RBN blog, we discuss the ever-increasing flows of gas to Mexico and the tens of billions of dollars of new infrastructure making it all possible.
For a few years now, U.S. natural gas producers have benefited from the electric-power sector’s shift from coal-fired plants toward gas-fired ones. The ongoing transition makes sense. Not only is gas-fired generation cleaner, it’s mostly been cheaper than the coal alternative. Better still, gas turbines and combined-cycle plants are very flexible companions to all those new wind farms and utility-scale solar facilities, whose variable output requires at-the-ready replacement power when the wind’s not blowing and the sun’s not shining. But with the continued push by many state regulators — and many utilities — for lower-carbon generation fleets, gas-fired plants are facing a growing challenge from energy storage, mostly in the form of very big lithium-ion batteries. Today, we look into the increasing use of large-scale batteries in utility settings and whether they might pose a serious threat to gas-fired power in the 2020s and beyond.
