Bold action is needed to change the world.
Solutions to energy poverty are often constrained to small-scale concerns such as cooking fuel and household lighting. These approaches, however, are not daring enough in their breadth and promise to solve wider scale human development goals. Energy access is a fundamental prerequisite for human development, and thus its potential to solve multiple developmental issues at once must be maximized.
A macro-level solution is needed that considers market conditions, infrastructure realities, and the other pressures that developing economies face. Natural gas, liquefied natural gas (LNG), and liquefied petroleum gas (LPG), are emerging as solutions to energy poverty and human development. The widespread use of natural gas can enable countries to pursue economic development, health, and environmental goals simultaneously.
Power and cooking
The 3 billion people who use inefficient fuels to cook and the 1 billion people who do not have access to electricity are in desperate need of solutions. These household’s constraints limit individuals, families, communities, and on a macro-level, local economies. Natural gas has high potential as an alternative fuel in these communities since it is clean burning and efficient. Access to natural gas for cooking in communities without electricity can pave the way for its use as an electricity generation source in rural areas.
Health and security
Natural gas can improve the health of developing communities by lowering the carbon intensity of their power generation. The predominance of coal in developing countries presents significant environmental challenges considering the unadvanced technology in use. The supply, reliability, and efficiency of natural gas can also reduce power shortages and blackouts. Power shortages and blackouts are threats to human life in many weather conditions, and present national security risks for developing countries.
Infrastructure and markets
The emerging LNG market can provide diverse energy solutions. It is easily transportable and its accessibility is a downward force on global prices. A fall in oil prices has consistently reduced the spot price of LNG particularly in the Asian and African markets. While floating LNG projects are providing short term infrastructure relief, the substantial investment needed to construct LNG import and export facilities remains a significant barrier to widespread adoption of the fuel. Significant investment in other areas of the natural gas supply chain is needed to maximize the fuel’s benefits.
The role of the United States
The United States is poised to be a significant player in the global LNG market in the coming years. It has the supply, infrastructure, and capital markets needed to influence the market in a big way. Most importantly, policy progress is being made as well. The Department of Energy recently proposed a rule to expedite the approval of small-scale LNG exports from the United States. The is a significant development, since many developing countries do not yet have the demand nor the infrastructure to import large quantities of LNG from tankers using large LNG terminals. The emerging small-scale LNG export market is the first step in the development of a global LNG market.
Once such a market develops, many parts of the world will experience great reductions in energy poverty and strong progress towards their developmental goals, all thanks to affordable and accessible natural gas.