Pipeline boss questions rush for renewables

North American Shale Gas is reshaping natural gas via hydraulic fracturing and pipelines, enabling coal-to-gas shifts in Ontario, stabilizing electricity prices, and challenging high-cost renewables like wind and solar under evolving energy policy.

Ontario is rushing too quickly into expensive renewable energy plays, when natural gas offers some breathing room on energy supply, says Greg Ebel.

Ebel has an interest in the issue. As chief executive of Houston-based Spectra Energy, which owns Union Gas, he's in the natural gas pipeline business with peers such as Enbridge as well.

But Ebel says the development of shale gas deposits has so vastly increased reserves of relatively clean energy in North America that there's time to take a more measured approach to renewables.

He is lobbying anyone who will listen, most recently a session of the Economic Club of Canada, citing energy industry warnings about costs.

He has also carried his message to politicians in Ottawa and Toronto: "I probably see the premier once or twice a year. He's very open on energy issues."

In an interview, Ebel argued that the development of shale gas deposits in northeastern North America has changed the energy picture for Ontario's Ontario energy plan as well.

Shale gas is trapped in rock up to 10,000 feet deep. Energy companies have now developed techniques to shatter the rock deep underground, releasing the gas which is then piped to the surface.

Ebel figures that today's shale reserves give North America a 100-year supply of gas. That's a reservoir than should allow North America to dramatically lessen its burning of coal and oil, he says.

He also argues that the massive supply will also keep prices far more stable than over the past decades.

"I literally believe that the technology changes around shale may be as dramatic as going from the horse and buggy to the car," Ebel said.

Coal-burning electric plants in the U.S. can be rapidly converted to gas, he said. And he thinks commercial vehicle fleets could be converted to natural gas on a huge scale.

But he also maintains Ontario should significantly boost its natural gas electricity generation capacity – and take a much slower approach to developing high-priced renewable sources such as solar and wind-powered generation, since a rush to renewables can raise costs.

Ontario is signing big contracts with wind and solar-powered generators, at high prices, even as it seeks to ease energy cost hikes for ratepayers. Consumers currently pay about 6 cents a kilowatt hour for the energy portion of their electric bill. Wind generators will get 13.5 cents, and solar generators from 44 to 80 cents.

Ramping up natural gas-fired generation would produce power relatively cleanly, and at far less cost, Ebel argues, despite campaigns arguing paying more for power can be beneficial.

"I think the gift of natural gas is giving us time to make the transition, so you don't kill the economy," he said.

Ontario's Green Energy Act policy, introduced by former energy minister George Smitherman, is likely to have too drastic an effect, he said.

"I don't think he fully recognized the massive benefits of natural gas, or of having a balanced approach to energy."

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