While the plunge was more abrupt with Patriot, comparable coal credits have also seen sharp declines amid historically low natural gas prices and a regulatory environment that is pushing a coal-to-gas transition.
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For gas prices to get this high on a sustained basis, you have to assume that either (a) shale gas will prove a colossal, over-hyped, mega-bust (something the Right is most definitely not in the usual business of positing) or (b) the U.S. auto-fleet will quickly transition to natural gas powered engines, driving up the demand for natural gas and, thus, the price.
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If that hope comes true, the transition from coal to gas will generate a huge burst of economic activity and accelerate the transition to a more sustainable future for humanity.
The transition from coal to gas explains why U.S. carbon emissions declined 8% from 2011 to 2012, reaching the lowest level since 1992.
One approach would peg the reserve volume to the time required in an emergency to transition the economy from natural gas to a substitute fuel.
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For the UK and other wealthy nations, shale gas cannot be a transition fuel to a low-carbon future.
Push the transition away from oil to natural gas and alternative fuels.
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Ibrahim Ajami, the CEO of ATIC, told me that government and business leaders had identified semiconductors as a core business to compete, part of a long-range 2030 plan to transition the economy from oil and gas business to high technology and to build its own chip foundries.
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Many believe the natural gas bonanza may be a transition fuel for the larger clean energy transformation.
But abundant and cheap shale gas has sped up that transition.
Persistently high oil prices would clearly lead to substitution (electric cars, natural-gas-powered trucks) but the transition costs could be significant.
All told, this transition to more plentiful, diverse and widespread reserves in effect makes gas a bit more like coal, and a bit less like oil.
Mr. McClendon pledged that it was "now time to transition" from being an aggressive company that discovered and leased new oil and gas fields to one that would focus on cutting costs and delivering "exceptional returns" for investors.
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