Natural Gas Combined Cycle Utilization: An Empirical Analysis Of The Impact Of Environmental Policies And Prices

Keywords

Environmental Policy; Natural Gas; Natural Gas Prices; Utilization

Abstract

Recent climate regulations include increased utilization of natural gas-fired combined cycle (NGCC) generators as a means for offsetting coal generation to reduce carbon emissions. There have been substantial increases in utilization for some generators, but most remain below baseload levels. This paper examines the factors that have driven NGCC utilization from 2003-2014. I run difference-in-difference models to evaluate the relationships between environmental policies and natural gas prices on NGCC utilization. Both low natural gas prices and the Clean Air Interstate Rule (CAIR) drive increases in utilization. However, the size of the impact by CAIR depends on the age of the plant. I use the estimates from this model for a counterfactual analysis which reveals CAIR had nearly twice the impact of low natural gas prices on increased utilization in nationwide averages.

Publication Date

1-1-2018

Publication Title

Energy Journal

Volume

39

Issue

5

Number of Pages

205-229

Document Type

Article

Personal Identifier

scopus

DOI Link

https://doi.org/10.5547/01956574.39.5.kste

Socpus ID

85056748765 (Scopus)

Source API URL

https://api.elsevier.com/content/abstract/scopus_id/85056748765

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