first_imgReport argues for quick closure of natural gas transition “bridge” FacebookTwitterLinkedInEmailPrint分享Utility Dive:Investment into new natural gas infrastructure like pipelines and power plants is “incompatible” with long-term shareholder value, and thus it is in the best interest of the investor community to push utilities away from natural gas, according to a new report from corporate social responsibility group As You Sow and environmental consulting firm Energy Innovation.The report’s authors note that while natural gas has helped reduce emissions over the past decade or so by serving as a “bridge” fuel away from coal, “to achieve a safe level of climate stabilization and protect investor portfolio exposure to global climate change, the bridge for natural gas and its associated emissions must have a clear end,” they wrote.The question of when or if natural gas investments will become “stranded assets” has been controversial in the investment community. Some argue that even with political and societal pressures to move toward net-zero emissions, natural gas will still be a dominant source of electricity generation and heating, and that utilities are to some degree protected from the risk of stranded assets by the fact that they can recover the costs of natural gas projects with regulatory approval. Others claim, however, that gas will soon become “the next coal” and that regulators’ appetite for charging customers for stranded assets may be waning.The report makes the case for the latter position with three key points, as co-author Mike O’Boyle, director of electric policy for Energy Innovation, described during a webinar about the report.First, he said that natural gas infrastructure that is built now will not depreciate until around 2050, meaning that even if the shift toward clean energy takes decades there is still plenty of time for natural gas assets to become stranded.Second, “renewable and storage costs will continue to drop, while natural gas infrastructure costs are mature and fuel costs are variable,” O’Boyle said.Third, utilities can provide investors with a better return going forward by treating decarbonization as “a massive capital investment opportunity,” O’Boyle said.[Matthew Bandyk]More: Report: Natural gas is a loser for long-term utility shareholder valuelast_img

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