March 17th, 2015 by Tina Casey
Original link: http://cleantechnica.com/2015/03/17/dow-latest-us-business-throw-natural-gas-bus/
The intertubes are abuzz with news of a major wind energy buy engineered by corporate giant Dow Chemical. The company has announced that it has sealed the deal on an agreement with a soon-to-be-built wind farm in South Texas. Once up and running, the wind farm will provide Dow’s facility in Freeport with 200 MW annually.
That’s gotta be a stab in the heart to Texas natural gas suppliers, which are already suffering the effects of a gas and oil boom turned bust. The big question is, why not gas? After all, until now natural gas has been the go-to choice as a replacement for coal power plants…
Wind Energy, Coal, And Natural Gas
When we think of major renewable energy buys, the first thing that comes to mind is the tech industry. Notably, Tesla, Google, and Apple have been all over wind and solar energy for the past few years, with multiple projects online or in the planning stages.However, we’re also beginning to see major renewable energy investments amongst more traditional US industries, and Dow provides a good example of the reasoning behind that move.
Generally speaking a couple of things are beginning to undercut the conventional rationale for replacing coal with natural gas.
The oil and gas boom has lowered the price of natural gas and boosted it into a highly competitive position against coal for power generation, and in terms of carbon emissions natural gas is a much cleaner-burning fuel.
However, if we were Dow, we’d give the stinkeye to that cheap natural gas thing. With the oil and gas industry in a bust cycle, drill rigs are being idled, supplies will tighten, and prices will inevitably rise.
In that context, wind energy is a tidy hedge against future price increases. Once the turbines are humming along, the “fuel” is free.
As for carbon emissions, evidence has been piling up regarding the true lifecycle emissions of natural gas, and the picture looks even less pretty when you factor in the risks and impacts associated with fracking and fracking waste disposal (for those of you new to the topic, fracking is short for hydrofracturing, a method of oil and gas drilling that involves shooting fluid into shale formations at high pressure).
Also not helping the case for natural gas is a new coal and wind energy study demonstrating that in terms of reducing carbon emissions, it could make sense to maintain an energy profile that balances more coal power plants with renewable energy, rather than going for a mix that includes fewer coal plants and more natural gas plants.
(DJS -- this is misleading: if the natural gas replaces the coal, there is a net emissions reduction.)
Dow Chemical And Wind Energy
Dow’s wind energy announcement came during a rather interesting week for clean energy. We were just taking note of three new renewable energy studies with questionable pedigrees, one of which purported to show that wind energy is a money-loser, but that doesn’t seem to have taken the wind out of the company’s sails.Here’s Dow’s VP of Business Operations Seth Roberts on the implications of the new wind energy buy for Dow’s bottom line:
Adding large scale renewable energy to Dow’s manufacturing process is just one smart move that we can make to secure a future of sustainability, growth, and long-term competitive advantage. This decision also serves as a systemic hedge against both energy and power price volatility, while improving our overall carbon footprint.
Okay, so it’s still Dow Chemical (yes, that Dow Chemical), but in addition to its clean tech buys the company’s sustainability goals include transitioning to a more sustainable chemistry platform, so there’s that.
