Obama Signals A New Direction For Energy In The United States
President Obama’s climate change speech last Tuesday at Georgetown University was a solid affirmation that the U.S. will be taking action to reduce greenhouse gas emissions, help the country adapt to climate change, and make the U.S. a leader in international efforts to avert severe global warming. The President’s 21-page Climate Action Plan that went with it outlines changes that may finally propel the U.S. towards an energy strategy that will “be more than just about drilling for more oil, about more than building one pipeline.”
The Climate Action Plan renewed President Obama’s commitment to reduce U.S. emission by 17% of 2005 levels by 2020, while setting the goal of doubling the amount of renewable electricity generation by 2020.
The U.S. has a long way to go, though. A graph from Climate Action Tracker shows how far behind the U.S. is in terms of international climate action leadership, compared with both developed and developing countries.
‘Tough New Rules’ For Coal
Of particular interest to the power and energy sectors are the “tough new rules” that the Environmental Protection Agency must set on the carbon emissions of power plants, which diminishes the role of coal—the U.S.’s top source of carbon emissions—in no uncertain terms: 1) coal-fired power plants must either retrofit to be cleaner burning or shut down; 2) no new coal-fired power plants can be built without carbon capture and storage (CCS) technology installed.
“Dramatic” is almost an understatement in describing the price drop of NYMEX coal futures last week after President Obama’s speech. It’s an interesting contrast against Henry Hub natural gas futures, which happily crept up by a fraction of a dollar per MMBtu. Coal futures have since regained their composure this week, albeit at a lower price.
Figure 1: U.S. Natural Gas Vs. Coal Prices. Graph generated in ZEMA.
The uptick in the price of Henry Hub futures is an indication of the more prominent role that natural gas will take in the U.S. as a transitional fuel in the near future, as coal power generation gets phased out of the U.S. power grid and renewable energy gets phased in.
I work with a company that has developed an end-to-end enterprise data management solution for energy, commodities, and financial market data. We offer clients access to an extensive global market data library using our flagship product the ZEMA Suite. By using our product you can have quick and easy access to U.S. coal prices and other prices worldwide.https://blog.ze.com/our-industry-views/obama-signals-a-new-direction-for-energy-in-the-united-states/https://blog.ze.com/wp-content/uploads/2013/07/iStock_000010634240XSmall.jpghttps://blog.ze.com/wp-content/uploads/2013/07/iStock_000010634240XSmall-283x300.jpgIndustry Viewsclimate change,coal,ObamaPresident Obama’s climate change speech last Tuesday at Georgetown University was a solid affirmation that the U.S. will be taking action to reduce greenhouse gas emissions, help the country adapt to climate change, and make the U.S. a leader in international efforts to avert severe global warming. The President’s...Karen HungKaren Hungkaren.firstname.lastname@example.orgContributorBlogs by data management Experts & Analysts | ZE