Electric cooperatives and utilities across the U.S. are focused on providing safe, reliable and cost-effective services. In rural communities, power providers are often challenged to deliver affordable and reliable energy. Despite the rapidly evolving advancements across the energy industry, many remote areas are supported by aging infrastructure, which is susceptible to failure and can be challenging to maintain.
For rural power providers looking to invest in their electric infrastructure, the liquefied natural gas (LNG) market offers a reliable and cost-effective solution well-suited to meet the growing energy demands of rural communities. To support these upgrades, government agencies often serve as the major players in efforts to modernize and maintain electricity in rural areas. For example, in June 2020, the U.S. Department of Agriculture invested $1.6 billion to build or improve rural electric infrastructure in 21 states.
Today, the U.S. is the top global producer of natural gas and a top exporter of LNG, which means there is an abundance of the fuel, often at an affordable price. LNG is created by cooling natural gas to its liquid form. It takes up significantly less space than natural gas in its vapor state, allowing LNG to be easily stored and readily accessed, so utilities can reserve greater amounts of energy for when it is needed most.
When power providers consider fuels for peak-shaving electric generation facilities in rural communities, satellite LNG facilities are often the favored solution. This is especially true for owners and operators of electric generating peaking facilities who also own nearby LNG facilities with liquefaction capabilities, as they can utilize their own LNG to maintain storage levels at their satellite plants. This approach gives producers the flexibility to manage their energy supply on a local level.
LNG satellite facilities require minimal space to house the LNG, allowing large amounts of energy to be stored in a relatively small space. The small site required to support these facilities, coupled with a remote location for the electric generating station, often results in simplified measures around siting and permitting. This can be attractive to power providers who may otherwise face permitting challenges and costs involving pipeline development in rural areas.
Typically, a satellite LNG facility consists of horizontally mounted aboveground submarine-style tanks, a truck or rail offloading component, and a vaporization unit to revaporize the LNG so it can benefit nearby customers. With eyes on LNG as an economic fuel source, the industry has seen significant technological advancements, including increased efficiencies in storage and in the vaporization process. It has also prompted a new standard to be established by the Pipelines and Hazardous Materials Safety Administration that supports the bulk transport of LNG in specialized rail cars, allowing LNG to be delivered in bulk quantities in a safe and cost-effective manner.
When rural power providers can invest in these critical infrastructure improvements, it helps create affordable, reliable and sustainable power and communication resources for rural residential, commercial, and industrial entities. These efforts also have the potential to improve the quality of life in rural communities, grow the rural economy and create job opportunities.
An engineer-procure-construct team can help LNG companies streamline the critical path to improve infrastructure project quality and efficiency.