Fossil fuel investments are doomed. part 3 a data-rich analysis of the gas market. red, green, and blue b games unblocked

##########

There are three major categories of fossil fuels: coal, oil, and natural gas. I discussed oil first, with a detour to electricity, and then coal. la gasolina cancion Now we’re on natural gas, and finally we’ll have a section on the fate of utilities. I will go through pricing calculations and comparisons to demonstrate that the alternatives to coal, oil, and gas are either already cheaper or guaranteed to be cheaper within the next 2 years for a sufficiently large percentage of consumers to cause huge drops in fossil fuel demand over the next 10 years.

There are very few pure-play natural gas companies. electricity magnetism Most of them are oil companies, and they make most of their money off of oil. There have been a few exceptions, but they were mostly hydrofrackers, and they have lost a lot of money. (Chesapeake is a good example of that.) Drilling for “Dry” Gas is Not Profitable Without Really High Gas Prices

In cold climates like New York or Minnesota, it is still slightly more expensive to heat with electricity using a heat pump than it is to heat with gas. In New York where I live, the heat pump becomes cheaper to operate if natural gas reaches $6 (Henry Hub). Gas prices were higher than that for most of 2003–2008. If the weather gets warmer, of course — as with the warm winter of 2016–2017 — it is cheaper to operate a heat pump in New York than to operate natural gas heating even at a price of $3.00.

However, the cost of new wind and solar is now below the cost of new gas turbines, as explained in the Lazard report cited earlier (new combined cycle gas turbines have LCOE of 4.8 cents/kWh to 7.8 cents/kWh; gas peaking plants have much worse LCOE). gas 69 And as wind and solar prices keep dropping, it’s also heading below the cost of operating old gas turbines – even at current low gas prices.

This is going to take a few years, but not very many. The record low solar PPA is currently from Dubai at 2.99 cents/kWh. gas news australia This is approaching the cost of operating an existing combined cycle gas turbine, which Lazard estimates at 2.6 to 2.7 cents per kWh if gas costs $3.44. (The latest Lazard report puts the range for the average gas combined cycle power plant at 4.1 to 7.4 cents per kWh.) Biogas can be Used as a Substitute for Low-Volume Demand

Landfills and sewage treatment plants generate substantial amounts of methane, which we have to do something with — and they’ll pay to have it taken off their hands. While nobody’s been willing to use it for cooking, it works perfectly well for electricity generation or plastics feedstock. Gas Demand can Only be Sustained by Very Low Prices

With the price of alternatives — mostly electricity — dropping, the demand for gas can only be sustained by very low prices. gas emoji As long as gas is produced as a side effect of oil drilling, these very low prices may be sustained. However, nobody’s making money on it. When the oil drilling stops, the supply of gas will drop and the price will rise. gas in babies at night But it cannot rise higher than the price of the alternatives, which keep dropping. So it cannot rise high enough to make any significant number of dry gas wells profitable — they will all remain unprofitable. Conclusion: Natural Gas

In the near term, there will continue to be a glut of natural gas due to attempts to produce lots of oil. Gas prices are exceptionally low. gas and bloating after miscarriage They have been above $4 (inflation adjusted) for a very long period prior to this year. This will keep the gas price down in the very near term, which will keep retail demand going for a while. However, it will also mean that no investment into gas-only wells will happen.

As the fracked wells run out, the gas supply will drop precipitously and cause price spikes. This will make electricity cheaper than gas and cause more people to switch from gas to electricity (and more utilities to switch from gas to solar or wind). It will not, however, cause financing of new gas wells; or if it does, they won’t get completed before the price crashes again.

This is a dying industry, although it will last longer than coal or oil — but it isn’t really a separate industry from the dying oil industry anyway. Standalone gas companies are already bankrupt. gas in dogs symptoms The oil and gas companies will lose a tremendous amount of money as the oil business shrinks. The gas business will also shrink, but more slowly, which won’t help them at all.