While natural gas will continue playing a larger role in Wisconsin’s energy mix, the state is equipped to handle any unexpected run-up in prices, according to a WisBusiness.com panel.
The panel, convened Thursday at the University Club of Milwaukee, consisted of Marty Durbin of the American Petroleum Institute, Public Service Commission member Mike Huebsch and WEC Energy Group senior vice president Dan Krueger.
The three agreed the sharp decline in natural gas prices and the bountiful supplies have been a boon to consumers. And it’s sure to grow as an energy source as the state looks to approve a new natural gas plant in Beloit, run by Alliant Energy and with some power going to the Wisconsin Public Service Corp.
But the fuel has has come under fire from both Dem presidential candidates, with U.S. Sen. Bernie Sanders calling for a ban on fracking entirely, saying it introduces a “cocktail of toxic chemicals” into the water supply. It also faces pressures from groups that oppose the building of interstate gas pipelines and have helped cause delays for some projects.
Durbin, API’s executive director for market development, downplayed those concerns, saying the U.S. has found a way to become a world production leader in a safe energy source.
It’s done so, in part, because of utilities anticipating a shift away from coal due to the Clean Power Plan. But it’s largely been due to the technological developments that have helped drive natural gas prices to “near historic lows.”
“Too often we see the policy questions or the debate out there put in terms of either protecting the environment or we can have energy,” he said. “It’s simply a false choice. We can have both. We are having both right now.”
There’s much more gas available and technology that effectively targets it, Durbin said. Its price, meanwhile, looks to be a “nice slow curve” that will keep it affordable in the future.
If prices do end up rising, though, the state’s efficient coal power plants will ensure consumers’ energy bills won’t go up too much, WEC’s Krueger said.
“If it were to take an unexpected turn, any effect on customer bills in Wisconsin would be pretty tempered,” Krueger said.
Wisconsin is among the most coal-reliant states in the country, though its usage of coal has decreased slowly over the years. Natural gas, which got significantly cheaper in recent years, picked up the slack and will continue to do so as federal regulations look to decrease coal usage, Huebsch said.
But it could also become a target later on since it’s not emissions-free, Huebsch said.
“Those who have successfully waged their war on coal will necessarily shift their focus to gas in the future,” he said.
That could mean that Wisconsin’s use of the non-emitting nuclear energy could rise in the future, Huebsch said. But despite Gov. Scott Walker and the Legislature lifting a moratorium on new nuclear plants, their construction is far from certain.
For one, the low natural gas prices make nuclear energy less competitive — the key reason why the Kewaunee nuclear plant shut down in 2013. The plants are also expensive to build and require many years of regulatory approval, he added.
But as renewable energies are still not reliable enough to serve millions of people, Huebsch said, the door could be opened for the state to turn to nuclear energy.
“Some are beginning to understand you can’t be emissions-free and nuclear-free,” Huebsch said.
— By Polo Rocha,
WisBusiness.com
