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ENRON CORP. CHAIRMAN KEN LAY PROMOTES "NATURAL GAS STANDARD" FOR ELECTRICITY GENERATION

 ENRON CORP. CHAIRMAN KEN LAY PROMOTES "NATURAL GAS STANDARD"
 FOR ELECTRICITY GENERATION
 HOUSTON, May 11, /PRNewswire/ -- Electric power generators and state public utility commissions should adopt natural gas-based power production as the environmental and economic standard for electricity generation, according to Kenneth L. Lay, chairman and CEO of Enron Corp. (NYSE: ENE). In a speech before the New Mexico Natural Gas Fair in Santa Fe, N.M., Lay noted that the most important factor affecting economic and energy policy in North America and around the world will be the increasing and intense concern about the environment.
 In his speech Lay outlined the significant environmental benefits and economic advantages of natural gas-based electricity generation.
 "The electric generation sector of the American economy contributes a significant portion of man-made air pollution," Lay said. In 1990, the predominantly coal-fired electric power sector of our economy generated: 66 percent of total sulfur dioxide (SO2) emissions; 37 percent of all nitrogen oxides (NOx) emissions and 35 percent of total carbon dioxide (CO2) emissions, he said.
 "The key challenge for power producers will be achieving the twin goals of environmental protection, through cleaner power production, and economic growth, via lower electricity prices," Lay noted. "I believe the solution is the "Natural Gas Standard," which simply means no new coal or nuclear power genMrating stations should be built unless they produce electricity cleaner, cheaper and more reliably than gas combined cycle plants."
 According to Lay, this is not a call to mandate the use of natural gas. In fact, a mandate is not needed to win significant market share. If allowed to compete in a free and fair competitive market, natural gas will win on its own merits -- its environmental benefits and economic advantages. Unfortunately, Lay noted, regulatory ratemaking biases discourage the use of natural gas as a power generation fuel and distort the power fuels market.
 "Enron is convinced that market-based public policy will unleash the creativity and technological progress necessary to provide America's consumers with the most value for their energy dollar," Lay said.
 Pollution prevention is the key to achieving the twin goals of environmental protection and economic growth. In the case of electric power production, cleaner can be cheaper. The old paradigm suggests just the opposite: If you want a cleaner environment, you have to pay for it through higher electricity prices. But according to Lay, cleaner air and lower levels of pollution are "free" when a natural gas fired power plant produces electricity.
 "Natural gas electric power generation is not only cleaner, it's cheaper -- at least 30 percent less costly than coal fired electricity generation over the life of the plant using long-term natural gas prices currently offered by Enron and others," Lay said.
 Lay also noted the environmental advantages of natural gas. Compared with a new coal fired power plant, a natural gas fired power plant reduces carbon dioxide emissions by 58 percent (the principal greenhouse gas), produces virtually zero sulfur dioxide emissions (the main cause of acid rain), and cuts nitrogen oxides by 80 percent (one of the main contributors to smog). Of course, a gas fired plant does not produce any solid waste -- ash or sludge.
 While methane emissions from both natural gas and coal are small relative to other sources, primarily natural sources, greater methane emissions are attributable to coal fired electricity generation than to gas fired generation, Lay said, noting that the Environmental Protection Agency (EPA) has called for the expanded use of natural gas to curb global warming.
 In terms of reliable natural gas supplies, Enron estimates the economically recoverable natural gas resource base in the lower 48 states at about 1,032 trillion cubic feet (Tcf). Adding 160 Tcf of proved reserves, the nation has about a 65 year supply at current levels of domestic production and without any significant technology breakthroughs.
 Natural gas combined cycle plants also have recorded very high levels of performance reliability and availability, Lay noted. Gas combined cycle power plants have reported availability in excess of 95 percent during the last five years. According to the North American Electric Reliability Council, nuclear plants had an average availability of 65 percent over the past five years, and coal plants had an average availability of 80 percent.
 Enron Corp., America's leading natural gas company with more than $13 billion in revenues and about $10 billion in assets, operates the nation's largest natural gas transmission system; markets natural gas liquids, crude oil and refined products nationally and worldwide; owns 84 percent of Enron Oil & Gas Company, one of the country's largest independent (non-integrated) natural gas exploration and production companies; is one of the largest independent developers and producers of electricity in the United States and the United Kingdom, with extensive experience in combined heat and power installations; and is a leading non-regulated purchaser and marketer of long-term natural gas supplies. Enron Corp. is traded under the ticker symbol, "ENE."
 -0- 5/11/92
 /CONTACT: Diane Bazelides, director, media relations, Enron Corp, 713-853-6285/
 (ENE) CO: Enron Corp. ST: Florida IN: UTI OIL SU:


SS-AW -- FL018 -- 8815 05/11/92 17:10 EDT
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Date:May 11, 1992
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