October 6, 2022
7 min read

The time to meet climate targets is diminishing. Natural gas can help.

Oliver Sachgau

There is an uncomfortable truth about the energy transition: The world is simply not ready to run on renewables. But hydrogen-ready gas-fired plants offer a quick answer to reducing emissions around the globe and avoiding a climate disaster.

According to the International Energy Agency (IEA), coal is “the single largest source of global temperature increase,” accounting for some 30 percent of all global carbon dioxide emissions. The switch today from coal to natural gas would cut those emissions in half. So, yes, fossil fuels could be an answer. But they are an incomplete answer.

The real solution is a “double” fuel switch: from coal to natural gas (as the world expands its renewable energy) and, finally, when the infrastructure and supply are available, to climate-neutral hydrogen. This means that every new power plant replacing coal should be hydrogen ready, prepared for a quick changeover to the crucial end goal of sustainable electricity production.

Gas helps us build a bridge to sustainability by cutting CO2 emissions in the short and medium term

Christian Bruch

CEO of Siemens Energy

“Gas helps us build a bridge to sustainability by cutting CO2 emissions in the short and medium term.” says Christian Bruch, CEO of Siemens Energy. “Further down the line, when more green hydrogen will be available, the approach will be different. But right now, it’s important we start tackling some things immediately while creating a path for a decarbonized energy supply.”

Shut down and replace coal

CO2 emissions rose 6 percent in 2021 to 36.3 billion tons, “their highest-ever level,” reports the IEA, “as the world economy rebounded strongly from the Covid-19 crisis and relied heavily on coal to power that growth.”

Coal is still the largest source of power generation in the world, responsible for around a third of our electricity – and it is the largest single source of CO2 emissions. Reducing these emissions today is critical to limit global warming.

“Replacing coal with natural gas offers us a way to significantly cut carbon emissions now,” says Bruch.

Compared to a coal-fired power plant, a modern combined cycle power plant (CCPP) produces around two-thirds less CO2 emissions. In Germany alone, if the coal-fired plants still in existence were replaced by state-of-the-art CCPPs the country’s power sector would cut emissions in half.

Coal accounts for nearly 22 percent of electricity generation in the USA, nearly 57 percent in China and almost 70 percent in India. Not surprisingly, these three countries also produce the most COemissions. Increasing the use of natural gas in their primary energy mix would drastically reduce emissions.

Ramp up renewable energy

“Renewable power is still the best option, therefore, renewable power systems need to be quickly expanded on a massive scale,” says Christian Bruch. “Nobody is questioning that.”

Wind and solar power accounted for around 10 percent of the world’s electricity generation in 2021 and continues to grow. However, as coal-fired power plants shut down, the expansion of renewables will only work in conjunction with an expansion of gas-fired power plants that will ensure grid stability and security of supply at times when the wind isn’t blowing and the sun isn’t shining.

Wind and solar energy, by their nature, are variable. Whenever there’s a lull, the grid needs another source of electricity in order to maintain stability and avoid blackouts. Large-scale power generation, such as coal, gas, nuclear or even biomass, can meet that demand, providing additional balancing power required to keep the grid frequency constant at all times within milliseconds.

Nuclear energy offers some advantages over coal, in particular an almost CO2-free power generation at a scale that supports grid stabilization. But it also comes with some well-known drawbacks.

Biomass offers another way to create lower-carbon electricity, but without a path toward 100 percent greenhouse gas reduction. Moreover, there is simply not enough of it to replace coal and provide grid stability at scale without seriously impacting the world’s agricultural food production and biodiversity.

Natural gas offers a less carbon-intensive solution over coal, it can be transported cost-effectively and stored, for example, in caverns that can serve as huge seasonal storage media. What’s more, the same gas infrastructure we use to transport and store gas today is largely suited for an upgrade to green hydrogen in the near future.

Become hydrogen ready

The latest Intergovernmental Panel on Climate Change (IPCC) report states that fossil plants will be vulnerable to becoming stranded assets in the next decade:

“Limiting warming to 2 or 1.5 °C will strand fossil-related assets, including fossil infrastructure and unburned fossil fuel resources (high confidence). The economic impacts of stranded assets could amount to trillions of dollars. Coal assets are most vulnerable over the coming decade; oil and gas assets will be more vulnerable toward the middle of the century.”

To achieve a truly net-zero economy, climate-neutral hydrogen, once available, will have to compensate the use of fossil fuels. Newly built gas-fired power plants must be prepared for a retrofit into hydrogen operation in order to prevent a carbon lock-in, once green hydrogen becomes readily available.

Unlike today, the future power generation landscape will be made up of direct renewable energy with support for grid stability and residual load coverage coming from gas-fired power generation running on these carbon-neutral fuels – and all this will come with affordable costs and the highest level of reliability.

Already today, new Siemens Energy gas turbines can be offered H2-ready, prepared for the upgrade to burn up to 75 percent hydrogen in the fuel mix, with 100 percent combustion capability expected by 2030. And it’s not just the turbines. Existing natural gas infrastructure, such as pipelines, caverns and tanks, can be converted to hydrogen operation with limited effort.

In Germany, according to a recent study by the independent think tank Agora Energiewende, “80 percent renewable electricity by 2030 and gas-fired power plants that increasingly run on renewable hydrogen can ensure the timely phaseout of coal and enable a climate-neutral power system by 2035.”

Worldwide, this approach is becoming increasingly important to reach net-zero emissions, since the eventual use of green hydrogen can help reduce emissions in a range of sectors that have typically proven difficult to decarbonize, including long-haul transport, chemicals, iron and steel, and industrial heat.

How long will we be using natural gas?

The war in Ukraine threw into sharp relief the relationship between sustainability, security of supply and affordability. Europe is now grappling with an energy security and affordability crisis that no one could have predicted at the beginning of the year and that will drive new changes in our energy systems.

How long we’ll stay on natural gas depends on how quickly we can accelerate an industrial-scale production of green hydrogen. We’ll need massive worldwide investments to get there, with some estimates as high as €50 trillion by 2040. Only through multilateral and decisive global action will we be able to start securing our energy supply, and make it sustainable and affordable enough for people to still use.

“There’s no single silver bullet, whether it’s solar, wind or hydrogen,” says Bruch. “We need to use all the technologies available to reduce CO2 emissions, including hydrogen-ready gas turbines and carbon capture – every ton counts.”

The time left to meet climate targets is diminishing. To limit warming to 1.5 °C, we’ll need to reduce greenhouse gas emissions by 45 percent by 2030 from 2019 levels. That’s less than seven years away, and the uncomfortable truth is that the world’s energy systems are not ready to run purely on renewable energy. The best solution we have now involves building up renewable generation capacity as fast as possible while switching from coal to natural gas power plants equipped for a hydrogen future.

October, 2022

Oliver Sachgau is a Berlin-based German-Canadian writer and journalist focusing on financial topics. His work has appeared in Bloomberg, The Washington Post, Fortune, and The Independent.

Combined picture and video credits: Siemens Energy