An Era of Change for the Energy Sector

June 2014

NSPE TODAY: POLICY PERSPECTIVES
An Era of Change for the Energy Sector

BY ARIELLE EISER

In the last five years, few industries have seen such fundamental change as the energy sector, demonstrated by the rise of hydraulic fracturing, a surge in natural gas, and the challenges of nuclear energy.

Yet the issues concerning nuclear electric power generation should also be considered within the larger context of national energy policy and the role professional engineers play in this issue. NSPE’s members come from all engineering disciplines and practice in the areas of government, industry, construction, higher education, and private practice. Regardless of expertise, practice area, or communities served, NSPE firmly believes that the public health, safety, and welfare is best served by positioning professional engineers where their skills can be used. To this end, licensed PEs play a vital role in the design, construction, operation, management, regulation, and development of all energy resources. (For more on NSPE’s stance on nuclear energy, see “Nuclear Energy at a Crossroads” in the November 2013 PE.)

energyNSPE strongly supports a diverse, comprehensive energy portfolio to ensure long-term, reliable, secure, and environmentally responsible energy supplies at predictable and affordable costs. Therefore, the nation must leverage traditional and newer energy sources to ensure energy independence. NSPE recognizes the value of energy sources ranging from coal, oil, and natural gas to wind, solar, and biomass.

Energy markets have seen dramatic upheaval over the last few years, following the growth of hydraulic fracturing. Conventional political wisdom tells us that this matter comes down to competition between traditional fossil fuels and renewable resources. If one thrives, the other fails. However, this is an oversimplification that does not accurately depict current energy markets. Solar and wind energy production have increased, particularly in certain parts of the country, but still remain only a small part of overall energy production. Tax credits, energy efficiency legislation, and federal regulations concerning carbon capture will provide an additional boost to renewable resources.

The coal industry, which has been most heavily scrutinized for its carbon-dioxide emissions, faces challenges on multiple fronts. Most notable is the Environmental Protection Agency rules that have been the subject of years of debate and are now close to completion. In September 2013, the EPA proposed rules limiting carbon from new power plants, creating instant backlash from coal companies that contend the rule would mandate carbon capture technology that is too expensive or simply unviable. The biggest test for the coal industry will likely come later this year when the EPA issues rules limiting carbon from existing coal plants. The rules are certain to impact the nation’s 1,400 coal plants.

At the same time, the natural gas sector is experiencing a sustained period of unprecedented growth. With the sudden glut of natural gas, which burns cleaner than coal and releases about half the amount of carbon, coal is also losing market share to natural gas as coal plants are replaced with natural gas plants for cost reasons. Yet, for all of these shifts in the energy industry, coal still plays a vital role in energy production. As of June 2013, coal accounted for 39% of energy production and 35% of electricity generation while natural gas accounted for 26% of energy production and 30% of electricity generation.

Energy markets will continue to shift as new technologies increase access to conventional and unconventional resources. Natural gas, biomass, nuclear, solar, wind, coal, geothermal, and oil should all be developed and maximized to guarantee that the nation’s energy needs are met in an environmentally responsible manner.

To ensure the protection of the public health, safety, and welfare, professional engineers, industry, and the government must stress excellence in the planning, design, construction, reliability of operation, maintenance, management, and regulation of all energy generation facilities. PEs will need to play a central role in this effort.

Arielle Eiser is NSPE’s government relations manager.