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News Article

Natural Gas’ Ongoing Revolution

By Cinthya Alaniz Salazar | Thu, 09/02/2021 - 16:01

You can watch the video of this presentation here.

 

Until the battery storage capacity needed to battle renewable energy intermittency becomes more accessible, the cleanest fossil fuel, natural gas, will continue to hold an essential role in the global energy transition. As Mexico’s energy demands continue to grow exponentially in tandem with a swelling population, there is an understandable urgency to address the current pitfalls that Mexico currently faces related to natural gas, including climate change, expanding distribution infrastructure, storage and increasing domestic production capacity.

“Gas is a very important fuel. Mexican geography and access to this resource make it the best solution for energy demand in the country,” said Marco Vera, Managing Director at GE Power Mexico.

In Mexico, addressing demand means expanding natural gas infrastructure to regions with energy deficits, namely the southeast region. Bringing natural gas to this underdeveloped region is a priority given that “states with natural gas enjoy greater development. This resource generates industry, new companies and employment. Gas impacts the whole economic chain,” according to Jorge Sandoval, Director General of the Mexican Natural Gas Association (AMGN).

Deficiencies in the natural gas pipeline are present across Mexico. Even states with existing and functional infrastructure lack proper interconnectivity between pipelines. “This includes large interstate pipelines or last-mile pipelines that connect with local distribution companies or individual projects,” Geoff Street, Director of Natural Gas Origination at Tenaska Marketing Ventures, told MBN. Before this infrastructure gets built, however, Mexico needs to consider how it is going to feed the system the natural gas volume it needs, which currently depends heavily on imports from Texas, which has been struggling with climate disruptions of its own.

As natural weather events become more frequent and more extreme, climate change has come to the forefront and become the central concern of international governments given its known capacity to destroy critical energy infrastructure. With such salient implications it has become an unmistakable priority to reinforce and expand existing infrastructure to not hamper economic activity and growth. After freezing subzero temperatures swept Texas, leaving some 4.7 million users in Northern Mexico without electricity for several days, it was clear not only that climate change vulnerabilities should be assessed in future projects but, perhaps more importantly, that Mexico’s dependence on imports had to be addressed.

There are plenty of international producers to choose from, including Mexico’s USMCA trading partner Canada or sanctioned Russia. Another possible avenue, as pointed out by CNH Commissioner Héctor Moreira, is to start developing the country’s natural gas production capabilities, especially if the country intends to meet its growing exponential demand and reach energy sovereignty. Mexico has vast untapped natural gas resources it could it exploit but Mexico currently lacks production capacity. Until Mexico reaches this point, however, it could also look at storage capacity to prevent disruption. Natural gas storage is a solution that only recently has been revisited but José García, President of AMGN, sees this as the ideal solution. “It is important to push storage policies to prevent situations like these from happening,” he said.

Considering sustainability targets, Mexico needs to be weary of methane leaks stemming from burning other fossil fuels. Daniel Zavala, a senior scientist at EDF reports that 4.7 percent of the methane produced in Mexico is leaked into the atmosphere, an average twice as high as that of the US. Zavala notes that this is a very high rate even at the global level. While it is difficult to avoid, it is absolutely possible to erase methane leaks from existence. “There is no need for this pollution. It is just completely unnecessary,” said Steve Hamburg, Chief Scientist at EDF to The Scientific American publication. “There are cost-effective strategies to capture harmful emissions. It is about paying attention and making the necessary investments.” Failure to take preventative steps threatens to undermine the purpose of using natural gas in cogeneration and efforts to reduce Mexico’s global carbon footprint.

Looking towards the future, although natural gas plays an important role in cogeneration now, what will happen when this transitional resource is no longer needed? Ramon Moreno, CEO of Mitsui & Co. Power Americas recognizes natural gas’ contribution to the energy sector will eventually come to a close and in preparation, industry leaders are looking at hydrogen as the next evolutionary step for the sector. Vera points out that GE Power has been working with hydrogen technology for the past 30 years and counts with 75 turbines that run either completely on hydrogen or a combination with other fuels. What has changed however is the technology surrounding hydrogen has recently made it cleaner and more efficient to produce. Yet, this sector is still in the early stages of development and just like with photovoltaics back in the day, “more investment is needed to get past the initial technology curb,” said Vera.

Cinthya Alaniz Salazar Cinthya Alaniz Salazar Journalist & Industry Analyst