K&J:

I'd take issue with two points, even while agreeing with your larger conclusions.

1) You write that "electricity rates will continue to go up and the only practical means of containing the impact will be to reduce consumption".

Not true.  One can also increase generation efficiency to lower carbon and energy prices even at constant consumption.  Given as the electric industry today is only half as efficient as it was in 1910, there is a massive opportunity to hedge away the risk of an awful lot of future growth in consumption.  Not infinite clearly, but way bigger than it gets credit for.

2) While I am not intimately familiar with the numbers, it bears noting that a strict well-to-wire calculation on LNG can be deceptive.  Recall that the push for LNG that began a few decades ago was driven to a substantial degree by the volume of "stranded" gas assets that are too remote to bring to market.  In many cases, these are byproducts of petroleum production and are simply flared as they occur.  I do not suggest that this is 100% of the LNG supply (nor do I even know what % it is), but as I recall it is not insignificant.  And even a horribly inefficient LNG fuel supply chain is better than flaring so long as the output is useful energy.  (e.g., a LNG to electric chain that embodies 99% losses from the wellhead to the wire is still 1% better from a carbon perspective than simply flaring it at sea).

All that said, your larger points are well taken about the upward pressure on price and the need to conserve.

CH4 is not as durable as as CO2.  GHG has a time element.  CO2 sucks big time.

I advocate CH4 power to replace coal power.  The issue is not solar thermal power storage.  The issue is replacing fossil fuels with solar energy.  CH4 is used to heat buildings, industry, and power.  The most cost effective (including storage) is low grade solar heat replacing CH4.  The most cost prohibitive is solar power replacing CH4 power.

Sean, what is the basis for saying generation is only half as efficient today as it was in 1910? In 1910 most of the electricity was generated by low pressure boilers. Today most of the coal plants are superheated, some supercritical with thermal efficiencies well over 40%.

Aside from that, the canceled coal plants will likely be replaced by gas fired. That's about the only source that is available and has a short lead time. We'll pay for it with increased electrical rates, increased home heating costs, increased chemical costs, etc.

Edison's first power plant was 6% efficient in 1880 as compared to today's 33% industry average.  But Edison's plant also recovered thermal energy, such that it was 50% overall efficient.  That total efficiency # increased up until 1910 when it peaked at 65% and then collapsed to today's 33%.  Yes, electric-only efficiencies increased in the interim, but the total fuel burned per MWh has doubled, since we now burn additional fuel in heat-only boilers that used to be recovered from power plants.

There are some (primarily in the electric industry) who claim that this is an apples:oranges comparison, but they're full of s*&t.  

Less pejoratively, overall efficiency is the only number that matters, and that's the number that's fallen in half.  And as I've posted elsewhere, the fall off started precisely when we established monopoly regulation of utilities, because that was the point in time at which returns were indexed to capital investment (as opposed to lower total costs) and operating savings/overruns were all treated as pass-throughs.  Ergo, the industry got a big incentive to build expensive stuff and no incentive to control opex.  The collapse in efficiency is the direct result.

I advocate CH4 power to replace coal power.

And where is all this Natural Gas going to come from?

Natural gas is far too valuable to be burning for power, so if it is going to be used in this sense it should only be used as peak load contributor. Also NG fields can contain up to 20% CO2 which is often not included in the CO2 intensity figure. A possible contributor to dampen out some of the fluctuations in output of wind and solar is Biomass. Now im not advocating the growing of Biomass in place of food crops, but instead utilising waste from agriculture and perhaps using certain biomass crops to assist in the remediation of damaged land. i.e. the growing of oil mallee in South Western Australia to lower the water table in high salinity areas.
Offcourse as other posters have noted this will only be feasible with improvements in generation side and end use efficiency.

Iran has a lot of gas.  

No, seriously -- as Sean so eloquently points out, cogeneration doubles fuel efficiency.  Gas is an excellent industrial-site power generator, very efficient, and at a fraction of the GHG impacts of coal.  It is quick and scalable.   A smart grid would really help.

Like oil, gas is too valuable to burn as low-grade heat (space heat et al.).  Easy, low-cost and low-grade efficiency improvements can save the gas we need for an efficient car/power bridge into the future.

We heat our cities with gas.  We need to ask the right questions.  How do we intend to heat the cities of the future?  Seriously.

Wondered when you'd get around to talking about it. Today there's a slight glut of it in the US and unlike crude oil and it's processed stuff, is lowering in price. Since U.S. benchmark prices are set at the Henry Hub in Louisiana, the LNG market isn't doing very well.

Why? Because LNG requires huge investments in special ships, loads of CO2-emitting ship travel to get it here, and then even more power (or thermal heat) to heat the stuff up for use in a pipeline, sometimes even using boilers.

I don't feel sorry for the LNG industry, although I can see they have high hopes for the future when demand outstrips what can be delivered from Canada and the Gulf of Mexico - which both have loads of natural gas right now. Suffice it to say the LNG market is upside-down for now, and was promoted not for energy diversity but because President Bush thought it was a nifty idea to trump a bunch of environmental and safety regulations.  

Yep, he even hired Pat Woods from Texas to be Energy Secretary so he could get 100 LNG projects on the books. Sheesh, nice move, huh?  

Need I mention thermal pollution and methane slippage?  Methane is 64 times more reactive than CO2.  /sammie

Onward through the fog

... I think we're already paying a terrorist tax, pirate tax, or whatever you want to call it.  It ends up in the shipping insurance and in the commodities market.  Maybe you would like to do more with it, but I think ship cargo insurance rates are at an all-time high.  The "terror tax" on crude is probably 20 to 30 dollars a barrel.  Interesting concept though.  /sam

Onward through the fog