Climate Change & Energy Supply
Montana’s High Fossil Fuel Scenario
Forecasting energy development is a lesson in uncertainty. There are several reasons for this. One is that many proposed energy-related projects simply never get built. A second is regulatory uncertainty with respect to carbon emissions. A third major reason is that the state has world-class coal deposits and current development barely scratches the potential of the reserves. Despite the relatively low level of current coal development in Montana, the many current initiatives and plans to exploit these reserves must be taken into serious consideration.
This same uncertainty also extends to oil. The U.S. Geological Survey (USGS) recently issued its much-awaited assessment of the Bakken oil formation that extends into eastern Montana from North Dakota and Saskatchewan. Production from Richland County’s Elm Coulee wells in the Bakken formation alone has almost doubled the state’s oil production in recent years. Still, to the surprise of many, the USGS estimated more than 4 billion barrels of recoverable oil from the entire formation. The Bakken is currently the largest oil reserve in the contiguous 48 states. Oil and gas, therefore, may be produced at much higher rates in-state than over recent decades.
Because of these uncertainties, a scenario of high fossil fuel development has been projected for Montana and the projected carbon emissions estimated. This high development case assumes much greater energy development in Montana than the reference case projected in the Climate Change Action Plan.
The high fossil fuel scenario for Montana assumes the following:
- Total natural gas production triples between 2005 and 2010, and increases an additional 74 percent above 2010 levels by 2020.
- Coal bed methane development is successful in Montana fields with construction of collector and delivery pipelines as needed.
- Montana petroleum refining capacity expands and an additional refinery is built in-state, possibly to process Athabasca crude from Alberta’s oil sands.
- Two commercial coal-to-liquid plants are constructed with coal mining increasing as needed to support the plants.
- A coal fluidized-bed combustion power plant is constructed as well as utility scale wind generation plants.
- Additional electric transmission lines are built to export power from Montana – up to 3,000 mega-watt total additional capacity, relative to current levels.
The above assumptions reflect the high end of estimates for fossil fuel development in Montana. Greenhouse gas emissions in 2020 are projected at 52 million metric tons given the high fossil fuel scenario, compared to 42 million metric tons under the reference case scenario. In all likelihood – by law or by regulation – carbon emissions from stationary plants would need to be captured and sequestered (see Carbon Sequestration).