Texas Contributes to Dramatic Decline in CO2 Emissions in U.S. – By Devon Bass, Vault Energy Solutions (Guest Blog)

By Guest Blogger, September 12, 2012, News, Small Biz

According to an analysis released by the U.S. Energy Information Agency, CO2 emissions in the first quarter of 2012 in the U.S. reached their lowest first quarter level in 20 years. The EIA report points out that year over year emissions were down 8% in Q1 2012. The first quarter is normally the most CO2 intensive period of the year.

Three primary contributing factors for the decline were listed in the report:

  • Reduced household heating demand due to a mild winter in most parts of the country.
  • The continued trend of switching to natural gas for electricity generation resulting in a decline in coal-fired electricity generation.
  • A reduced demand for gasoline. Declining demand for gasoline is generally associated with an economic slowdown.

With its leadership in both natural gas and wind energy Texas is playing an important role in the energy shift that is leading to progress in the area of reducing CO2 emissions.

Twenty eight percent of the marketed natural gas produced in the United States in 2011 came from Texas, making Texas the leading natural gas producer among the States.  As pointed out by the EIA report, the shift toward natural gas as a fuel for the production of electricity is a major contributing factor in the decline in CO2 emissions.  Natural gas burns cleaner than coal for the production of electricity.

Texas is the leading producer of wind electricity in the United States by a wide margin.  CO2 emissions associated with wind produced electricity are substantially lower than fossil fuel sources even when accounting for the manufacture and transport of wind turbines.

A Shift in the Texas Electricity Mix

Despite the fact that the Texas economy has been quite resilient throughout the economic challenges of the past few years, CO2 emissions continue to fall in the state.  This is true in both absolute terms (carbon emissions fell by 52.1 metric tons from 2000 to 2009) and in GDP adjusted terms.

In a measurement the EIA calls “Carbon intensity of the economy” Texas has reduced the carbon impact of its economic activity by around 25% from 2000 to 2009. “Carbon intensity of the economy” is obtained by measuring metric tons of energy-related carbon dioxide per million dollars of GDP.  Much of this fall can be attributed to Texas electricity increasingly coming from cleaner sources.

One interesting aspect of the Texas story is that it is the result of both public policy and free market dynamics.  The rise of the wind industry in Texas can be at least partially attributed to federal wind subsidies as well as state renewable energy mandates.  The boom in natural gas, on the other hand, is an illustration of pure free market dynamics.  Natural gas has become cheaper as a result of innovations in drilling technology.  The low cost of natural gas relative to other fuel has driven the market to prefer it as a fuel of choice for electricity production.  Largely as a result of cheaper natural gas prices, Texas electricity rates have fallen substantially in recent years.

About Devon Bass and Vault Energy Solutions
Vault Energy Solutions is a licensed energy brokerage and aggregator firm, with a mission to provide the public with options to find the lowest electricity rate possible. Devon Bass is Managing Director of Vault Energy Solutions.

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