Moving from coal to natural gas to power Michigan homes and businesses would have a positive economic impact on the state, increase employment levels and add to state and local tax revenues, contends a study by Michigan State University.
MSU marketing economist Bill Knudson did the study that was paid for by The Energy Foundation, a partnership of major donors interested in energy technologies that result in less pollution.
But natural gas prices have a history of volatility and while the cost is low now, there is no guarantee it will be that way after a utility spends hundreds of millions on a new gas plant.
Knudson said one of the peer reviewers of the study felt that with the large increase in natural gas production in recent years, prices will be more stable than they were in the past.
The environmental impact of drilling for the gas was not a part of the study, and knudson said the permitting process was one of several factors that could slow his projected construction schedule.
About two thirds of the energy in Michigan is derived from coal and Knudson’s study looked at three scenarios with various levels of moving more toward natural gas.
The construction of the needed infrastructure would create an estimated 19,000 temporary jobs and anywhere from 200 to 1,000 new, direct jobs, depending on how much natural gas is used.
Knudson said that since Michigan does not produce coal and has to import all that it uses, the state stands to gain financially from producing the available gas here.
Consumers Energy relies on oil and natural gas for 17 percent of its energy production, and the vast majority of it is imported from southern states.
At DTE Energy, natural gas accounts for 2 percent of its fuel mix, with 77 percent being from coal.
“We are looking at gas as a potential and future source of power,” DTE Energy spokesperson Len Singer said.
But the company also is keeping its options open on building a new nuclear plant.