Why the World Will be Slow to Abandon Natural Gas
Petrochemicals are the 800-pound gorilla that many fail to account for in their climate defense plans. Termed a blind spot of the global energy system by the International Energy Agency (IEA) petrochemicals are a driving force behind the increasing demand for fossil fuels.
Petrochemicals also appear to be one of the driving forces behind Trump’s re-election campaign. In the coming weeks and months, Appalachia coal regions and portions of the Rust Belt will become ground zero in the environmental battle between Trump and contenders for the Democratic presidential nomination and, ultimately, for the presidency. In the end, will it all come down to one word — PLASTICS?
Whether he is willing to admit it or not, Donald John Trump surely understands that coal will never return to market prominence in the power sector — absent some miraculous breakthroughs in combustion and carbon capture technologies. Technologies the Trump administration has shown little interest in developing.
Although Trump accuses Democrats of having launched a war on coal, the real culprits in terms of coal’s declining demand are market forces, e.g., the price of alternatives, about which even coal-state Republicans have shown little genuine interest in overriding. Having promised renewed prosperity to coal country conservatives, Trump is now on the hook to deliver. These are, after all, his peeps.
There is substantial pressure building on Trump to deliver not only for his coal country constituents but his core supporters throughout rural America. Much of the pressure he is feeling today is self-inflicted being the natural consequence of his failings to bend power markets to his will or win the trade war he started with China. Trump’s winning margins in the 2016 elections were too thin for him to rest comfortably on the backs of his largely aging white supporters.
It appears Trump intends to swap a long-dying Appalachian coal sector for a vibrant petrochemical industry that is beginning to build along a 386-mile corridor that follows the Ohio River and touches five states — Pennsylvania, Ohio, West Virginia, and Kentucky. (Figure 1) Feeding the industry are the proximate and plentiful gas supplies of the Marcellus and Utica fields.
Anchoring the proposed Appalachian Storage Hub is Shell’s soon-to-be-completed cracker plant in Monaca, Pennsylvania. A construction project, begun in 2012 during the Obama administration, for which Trump is now taking the credit.
Trump recently traveled to Monaca, where he spoke about America’s Energy Dominance and Manufacturing Revival — using the cracker plant as a backdrop and its workers as paid props. When finished the plant will take natural gas from the Marcellus and Utica shale deposits and turn it annually into more than a million pounds of plastic for use in the manufacture of everything from the red straws sold on the product page of Trump’s Make America Great Committee to solar panels, wind turbines, and consumer packaging.
Trump used the occasion of his Monaca visit to celebrate the revolution in American energy that’s helping make our economy the envy of the world. In between often incomprehensible riffs and unsubstantiated claims, Trump managed to state with hazy clarity that the Shell facility is:
…one of the single-biggest construction projects in the nation. And it made it possible and was possible by clean, affordable, all-American natural gas. Powerful, clean, natural gas…With your help, we’re not only unleashing American energy, we’re restoring the glory of American manufacturing, and we are reclaiming our noble heritage as a nation of builders again.
According to the International Energy Agency (IEA), demand for plastics has outpaced all other bulk materials — including steel, aluminum, and cement — nearly doubling since the start of the millennium. The United States, Europe, and other advanced economies use on a per capita basis up to 20 times as much plastic and up to ten times as much fertilizer as India, Indonesia, and other developing economies underscoring the massive potential for petrochemical growth worldwide.
When completed, the Shell plant will have rolling rail stock of 3,300 freight cars and be fed by pipelines stretching hundreds of miles across Appalachia. Trump accurately described the plant as one of the largest active construction projects in the US. It is one of more than a dozen petrochemical plants being constructed or planned for across the world including the states of Ohio, West Virginia, and Pennsylvania.
The construction phase of the Shell project is employing over 6,000 workers — from as many as 28 states. Once completed in the early 2020s the plant will create 600 permanent jobs. The project has already made a significant contribution to the local economy.
Petrochemicals are estimated by the International Energy Agency (IEA) to account for more than a third of the growth in world oil demand to 2030, and nearly half the growth to 2050. By 2050 the petrochemical industry will require seven million barrels of oil per day; it will annually consume 56 billion cubic meters (bcm) of natural gas by 2030 rising to 83 bcm by 2050.
Trump has consistently tried to use his executive powers to clear the way for oil and gas infrastructure projects — with varying success[i]. Since taking office, Trump has issued eight executive orders and at least two presidential memoranda calling for expedited environmental reviews and other regulatory reforms intended to lift “burdensome” environmental requirements from off the shoulders of oil and gas companies[ii]. One of the memoranda granted the Keystone XL pipeline a presidential construction permit — a circumstance made possible because the pipeline crosses an international boundary.
The proposed Appalachian Storage Hub presents significant risks and rewards for the communities within the 386-mile corridor. As Michael Corkery writes in the New York Times:
This is a place where, right now, plastic makes sense to many people. To the labor union gaining new members. To the world’s third-largest company struggling with low oil prices. And to the former government officials who, in seeking to create jobs, offered Shell one of the largest tax breaks in state history.
Beyond potential economic rewards, the communities in the corridor are being exposed to the inevitable environmental risks associated with fracking, e.g., water pollution, the transport of oil and gas through pipelines, e.g., methane leaks, and chemicals by truck and rail, e.g., derailed and split-apart tank cars. Those risks rise accordingly with the two to threefold increase in fracking activities needed to feed Shell’s cracker plant. The administration’s efforts to rollback Obama era methane emission rules only adds risk to the proposition.
There are also 2.2 million pounds of CO2 to consider. These emissions — permitted as part of Shell’s deal with Pennsylvania — equal the emissions from 480,000 automobiles.
Residents of the five-state hub are not the only ones who stand to be harmed. The pollution in Pennsylvania will not stay in Pennsylvania.
Part of the pitch in favor of plastics is their use in autos and trucks — with lighter vehicles come increased fuel efficiencies and decreased emissions. Although the pitch is not entirely without merit, it belies the problem of continued reliance on fossil fuels.
Whereas Trump or some surrogate will praise the administration for sup-porting a cleaner fossil fuel, i.e., natural gas, that particular argument loses strength as time becomes more of the essence. Whether there are 12 or 20 years between now and when the 1.5 degree Celsius point of no return is crossed, it is of little consequence in the larger scheme of things.
Then too there is the problem of plastics in landfills and waterways. According to the Ocean Conservancy:
Every year, 8 million metric tons of plastics enter our ocean on top of the estim-ated 150 million metric tons that currently circulate our marine environments. Whether by errant plastic bags or plastic straws winding their way into gutters or large amounts of mismanaged plastic waste streaming from rapidly growing economies, that’s like dumping one New York City garbage truck full of plastic into the ocean every minute of every day for an entire year!
If plastic in the oceans were not already bad enough, the Denver Post just reported that scientists testing rainwater around metro area and high in the Front Range mountains found microscopic bits of colored plastic in more than 90 percent of their samples — adding to growing evidence that plastics have contaminated the planet far more deeply than anyone imagined.
Time and money would be better spent on finding sustainable alternatives as opposed to lesser evils. The more money sunk into building out a natural gas infrastructure, the less motivated investors and lawmakers will be to strike them off the books as stranded assets. We’ve seen how otherwise uneconomic coal plants have lingered long past their shelf-lives.
None of this, however, is to say that Trump’s presidential opponents should be expected or encouraged to oppose Shell’s cracker plant or the long-range development of the area. The economic development of Appalachia and the Rust Belt should be a priority of both political parties. The economic development of the area solely as a natural gas hub — not so much.
Democrats would do well to emphasize economic and resource diversity — as it is unlikely that Trump will not. The five-state hub area is well aware of what happens when one or two industries, e.g., coal and steel, are allowed to dominate.
Voters along the 386-mile Ohio River corridor should prove a willing audience to hear what climate defending politicians — Democrat and Republican — have to say about developing the hub-area as centers of research and production of sustainable materials for the near and long-terms. If the future is to be only about one word — what say you to “diversity?”