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Is Gas Fired Generation Really a Clean Energy Choice? It still Produces CO2!

Is Gas Fired Generation Really a Clean Energy Choice? It still Produces CO2!NextEra CEO Sees Clean Energy Standards Replacing Recent Climate Proposals

NextEra Inc. (NEE) Chairman and Chief Executive Lewis Hay said Monday that low natural gas prices have affected the economics of other sources of power generation, but that regulations will continue to drive the development of clean coal, wind, solar and nuclear development.

“With low gas prices, gas-fired generation kind of snowplows everything else,” Hay said during the Edison Electric Institute’s annual financial conference in Palm Desert, Calif.

Natural gas is a cleaner alternative to coal and it has been significantly cheaper to switch to this fuel source compared to developing new wind, solar or nuclear generation. How ever it depends how you define cleaner! The combustion of natural gas still produces CO2. For example 10,000 cubic feet of natural gas per month produces a little less than 2 tons of CO2 annually.

Coal will likely remain an attractive source to generate electricity because of large, abundant supplies, Hay said. “It behooves us to invest in coal,” either through plant retrofits to reduce emissions or by building new clean coal plants. However, companies with the largest exposure to coal-fired plants have been making “contingency plans,” such as building out cleaner generation or retrofitting existing plants, to prepare for stricter environmental regulations.

NextEra, which has been an industry leader in developing renewable energy in the U.S., has about 40,000 megawatts of generation with less than 4% coming from coal.

Meanwhile, Hay sees alternative energy development supported by state renewable portfolio standards given that cap-and-trade legislation in Washington seems to be dead.” Instead, politicians could push for a new program that sets clean energy standards that mandate the use of renewable sources of energy.

Renewables are not going to be the ultimate solution but they will represent a fairly reasonable chunk 10 to 20 years from now,” Hay said.

The pace of new renewable projects has slowed but the U.S. Environmental Protection Agency continues to move ahead with regulations to reduce harmful greenhouse gas emissions and mercury, among other initiatives.

“I do think we are going to see some nuclear plants being built,” but at a slower pace than in the past, Hay noted. Solar could also emerge as an attractive supply of electricity during peak power demand given declining photovoltaic prices, he added.

Currently, offshore wind economics are not as attractive as onshore development, which requires just a third of the capital costs, he said.

-By Naureen S. Malik, Dow Jones Newswires; 212-416-4210; Naureen.malik@ dowjones.com

Is Gas Fired Generation Really a Clean Energy Choice? It still Produces CO2! Tags: alternative energy, alternative energy development, clean, clean energy, clean energy co2, clean energy generation, contingency plans, energy development, environmental protection agency, megawatt, reduce co2, renewable, renewable energy, renewable portfolio standard, renewable portfolio standards, renewable projects, renewable sources, renewable sources of energy, renewables, solar, solar thermal magazine

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