Journal of Energy Security

Text size
  • Increase font size
  • Default font size
  • Decrease font size
Home Archive August 2013 Issue Issue Content Islands in the Stream: The Compressed Natural Gas Grid as an Energy Security Enhancer

Islands in the Stream: The Compressed Natural Gas Grid as an Energy Security Enhancer

E-mail Print PDF
AddThis Social Bookmark Button

Often, our thinking about electricity supply takes place within what Thomas Kuhn, in his book Structure of Scientific Revolutions, refers to as a paradigm. According to Kuhn, paradigms are constituted by “..some accepted examples of actual scientific practice – examples which include law, theory, application, and instrumentation together – provide models from which spring particular coherent traditions of scientific research.” The use of these paradigms, or models, generates a common approach by practitioners. Indeed, one is considered a legitimate practitioner if and only if one’s practice is in accordance with the paradigm.

The dominance of a paradigm has both positive and negative implications for the acquisition of knowledge and in this case for changing the current paradigm for generating and distributing energy. Positively, paradigms make possible the development of a vast body of specialized knowledge.  Yet this strength of the model also has negative impacts on knowledge acquisition, for observations that do not fit neatly within the established confines of the model are obscured and sometimes jettisoned.  Shifting to new paradigms, from a centralized electricity production paradigm to a distributed energy paradigm is difficult and imposes high transaction costs. Therefore these paradigms resist change, which has the negative effect of limiting our ability to see and define problems in the larger environment. As Kuhn explains, “So long as the tools a paradigm supplies continue to prove capable of solving the problem it defines, science moves fastest and penetrates most deeply through confident employment of those tools. The reason is clear. As in manufacturing as in science – retooling is an extravagance to be reserved for the occasion that demands it. The significance of crises is the indication they provide that an occasion for retooling has arrived.”

Figure 1: The Existing Energy Supply Paradigm: Centralized Provision

Source: E3 Energy Corporation  

An energy security paradigm shift

A crisis that generates a paradigm shift must be so extensive that it inspires a reconfiguration of  the basic building blocks that have structured observation and action. Kuhn explains, “The transition from a paradigm in crisis to a new one from which a new tradition of normal science can emerge is far from a cumulative process, one achieved by an articulation or extension of the old paradigm. Rather it is a reconstruction of the field from new fundamentals, a reconstruction that changes some of the field’s most elementary theoretical presuppositions as well as many of its paradigm methods and applications.”

How does this relate to energy security? Our current energy discussions are built around an energy supply paradigm in which the functionality of the electrical grid system is assumed – distributed energy from renewable and other sources are merely a peripheral way to reduce consumption of fossil fuel, not the basis of an alternative distributed energy paradigm. However as awareness of the fragile nature of our current electricity production and distribution system grows,  some aspects of a paradigm shift are becoming apparent, but we have not yet experienced a sufficient dramatic crisis to motivate the leap into a new model. In short,  we lack a of sense of urgency. A crisis sufficient to motivate a paradigm change would impose extremely high costs – costs we are not only unwilling but that we are unable to bear. This article is a small contribution to encourage paradigm change by offering a vision of a parallel electrical grid system based on compressed natural gas (CNG) microgrids while we have the time and resources to protect ourselves from the negative impacts of a paradigm shaking crisis.

Challenges for grid power and vehicle fueling

Developing microgrids powered by compressed natural gas (CNG) and increasing CNG as a vehicle fuel, especially for heavy duty vehicles like the trucks that transport our food from farm to market and move good through the economy,  is a cost effective, managed approach to generating incremental improvements to our energy security situation. CNG microgrids are a partial solution to the interrelated problems of producing electricity and fueling vehicles when a casualty strikes the primary electrical grid. The steps outlined in this article will not entirely resolve these challenges, but it is argued that they can make significant, rapid contributions to two interrelated problems – the vulnerability of our electrical grid and the high (and rising) costs  (both financial and environmental) of reliance on gasoline and diesel as primary transportation fuels. CNG vehicle fueling is a potential “killer app” providing an economic incentive to invest in conversion of existing vehicles to run on CNG or purchase of new CNG vehicles, and invest in the fueling infrastructure necessary to take advantage of the cost savings CNG offers.

Figure 2 Physical or cyber attacks on transmission lines can take down the grid

 Source: E3 Energy Corporation

Willful blindness and our fragile electrical grid

In the current environment our electrical grid is vulnerable to a wide range of threats from multiple domains – mechanical failure due to storms or aged equipment, kinetic attacks from ground or air, and cyber attacks. Efforts are underway to better address the threats emerging from the physical condition of the grid infrastructure (transmission lines, transformers, etc.), and the cyber threats that have come to the attention of industry, policy makers and regulators.

However, low probability but high consequence atmospheric events, both natural and man-made, pose serious threats to grid functionality on a continental scale. Electrical Magnetic Pulses, or EMPs, are caused by high altitude nuclear blasts and destroy electrical equipment. A ballistic missile launched from a freighter off the coast, armed with a rudimentary nuclear warhead - a widespread technology- could produce an EMP effecting most of North America. EMPs are significant not only because of their ability to destroy equipment in an instant, but because the lead time for building replacements, even with a functioning electrical grid, is currently measured in years. After an EMP, when the industrial infrastructure for manufacturing the electrical system components is itself down, restoration would be exceedingly difficult. The Report of the Commission to Assess the Threat to the United States from Electromagnetic Pulse (EMP) Attack described this threat and made recommendations on how to begin to counter it, but little has been accomplished since 2004 when the report was released.

EMPs are not the only atmospheric (or extra-terrestrial) threat. Coronal mass ejections and geomagnetic storms from the sun could harm the electrical grid in EMP like ways - such an event damaged the Quebec electrical distribution system in 1989. In 2011 the Organization for Economic Co-Operation and Development (OECD) released a report entitled Geomagnetic Storms on the possible consequences and the need to take preparatory steps to manage the effects of such atmospheric events.

Figure 3 EMP takes down the entire energy system of systems 


Source: E3 Energy Corporation

The probability of the regional, or even continental loss of grid delivered electricity is not infinitesimal, the consequences are extremely severe and our preparedness lacking.  These atmospheric events, by disrupting the electrical grid would disable the food and water supply and distribution systems upon which we rely. However, actions to address the atmospheric threats on a system wide level remain inadequate.

Figure 4: Landscape map of potential grid disrupting events  

Source: E3 Energy Corporation

These vulnerabilities make our electrical grid fragile. Given this fragility, it is useful to ask the following question: how could we power our most critical infrastructure (water treatment plants, hospitals, public safety facilities) without the electric grid to supply the electrons? The answer requires a shift from our central electricity production paradigm to one using distributed generation.

The continent,  spanning compressed natural gas pipeline system facilitates the emergence of such a new energy distributed  paradigm based grid, and makes the creation of an alternative electrical supply and distribution system possible. These are: 1) the reduction in cost and increase in the supply of natural gas; 2) microgirds built around distributed generation including solar, wind and biomass and storage capabilities.

These alternatives (or more precisely, parallel options-since they do not require displacement of the existing electrical grid to function- can indeed supplement and support) for the grid can help meet our energy needs in two ways. One, they can provide the fuel to power grid tied generator sets providing additional power to the grid where required. Two, they can fuel generator sets serving as the primary power generation capability for energy generation, distribution and storage systems capable of operating as part of the larger grid or alone as “islands” separate from the main grid known as “microgrids”. These microgrids can utilize multiple generation sources, including solar panels, wind turbines and CNG generator sets.

Islands in the parallel compressed natural gas (CNG) grid stream

CNG distributed energy generation powering microgrids could serve as a parallel electrical grid, adding to the resilience of the existing power grid by providing distributed peak load capability as well as serving as a backup system of “islands” when the grid goes down due to accidental or man made causes like solar storms, EMP, terrorist attack or mechanical failure. The system of systems of microgrid “islands” in the CNG pipeline “stream” increases energy security by enhancing the anti-fragility of our energy supply systems.

 Figure 5 CNG Microgrids running off the CNG pipeline system post-grid casualty

Source: E3 Energy Corporation

The combination of these microgrid “islands” providing necessary services during a crisis in which the main electrical grid is no longer available would create areas of service and stability around which other actors could aggregate in order to maintain operations. For example, large enterprises like ports, water treatment facilities, and hospitals that create a microgrid ensure both their own continuity of service capability and provide a nucleus around which other service providers can gather. While not a total solution to the loss of the electrical grid, even if temporary, the islands deriving their primary power from the CNG pipeline system stream could provide sufficient functionality (CNG can power not only generator sets producing electricity, but compressors, chillers, and combined heat and power (CHP) units and other systems) to allow for the activity of an adequate number of normal life functions.

Energy security advantages of the parallel CNG microgrid system

The CNG microgrid has several advantages from an energy security perspective. First, the CNG pipeline system is pressurized by CNG or electrical compressors (with their own backup generators) and thus the pipeline remains operational and capable of providing fuel even when the electrical transmission grid is down. Today, for example, many cable companies take advantage of this capability by using natural gas powered generators which come on automatically during a power outage to provide signal continuity. The same technology enables CNG generator sets to respond instantly to supply a microgrid with uninterrupted power during a grid disrupting incident.

Second, the pipeline delivers the fuel to the generator without additional required steps.  When the electrical grid is down CNG remains available for use through the pressurized pipelines. This means that the generators can run when the highways or railroads are disrupted, in ways diesel and gasoline powered generators cannot once their initial on site supply is exhausted. This is a significant fueling capability enabler - as recent storms have shown, the gasoline and diesel distribution system can quickly grind to a halt as a result of electricity disruptions.

Third, microgirds offer a way to enhance energy security without having to rebuild or harden the entire electricity production and distribution system.  The deployment of these microgrids thus make the energy system, and the societies that depend on them, more in Nicholas Taleb’s term, anti-fragile. Anti-fragility is more than simply robustness or resilience – it refers to systems that benefit from volatility.  Any disruption to the main electrical distribution system increases the value and utility of the CNG powered microgrid.

Incentivizing development of the CNG parallel grid: what’s in it for me?

What are the incentives for electricity producers, consumers and large power users to shift their paradigm and install CNG based microgrids? The primary cost benefit analysis has to start with the proposition that the normal electrical grid is down and will not be repaired for months or years. What is the cost to an enterprise with no electricity or electricity relying on diesel generators that require refueling every 48 hours? If the enterprise can function without electricity or fuel for its vehicles, no investment in increasing anti-fragility within the distributed energy security paradigm along the energy security axis is justified. However, if it cannot function given these circumstances then  investment in microgrids, especially when as discussed below, much of the cost can be covered through savings on fuel (the money not spent on diesel can go to covering the CNG microgrid and CNG refueling infrastructure and vehicle conversion) makes sense. In addition, this focus on microgrids does not require the billons in investment required to harden the entire electrical grid – self prioritization, by both government and private sector actors can take place, allowing the market to stimulate the continuous search for solutions to challenges illuminated by the new paradigm.

The multidimensional use of the CNG stream offers a compelling value proposition, especially for enterprises involved in critical infrastructure operations and public safety. However, energy security concerns are seldom sufficient to motivate major investments the payoffs for which depend on improbable events. Additional financial and operational benefits are required to incentivize adoption.

The CNG based microgrid capability provides several advantages to the enterprise – even in the absence of disaster. First, it provides power necessary to operate business-as-usual (and doubly important when grid power is unavailable or interrupted). Second, it can support increased renewable energy utilization. The CNG distributed generation on the microgrid enables the microgrid operator to balance energy production and use, ensuring more efficient utilization of renewable sources. The CNG generator set can serve as the load balancer – at a given level of kilowatt commitment (to the microgrid or larger grid) the operator can generate power with whatever resource combination of generation makes the most sense given current environmental conditions (sunlight intensity, wind speed, etc.) bringing the CNG generator set on as necessary. Unlike a centralized utility, the microgrid operator is free from the obligation to maintain a large power plant online as backup when cloud cover increases or the wind dies down. Thus during “normal” operations the microgrid facilitates further deployment of renewable energy generating capacity.

Third, the microgrid based power distribution system can generate revenue during non-crisis operations. How? By linking the microgrid generation capability to the grid, the microgrid can provide power to the grid, either as part of the normal grid's generation capability or in response to peaks in demand. In this way the grid provides a market for the microgrid operator, enabling the microgrid operator to accrue additional revenue from CNG or renewably generated electricity produce in excess of the enterprise’s demands.  Yet often even this is not enough to motivate the investment necessary to deploy a microgrid network. However, the CNG stream offers an additional compelling source of anti-fragility and cost savings – vehicle fueling.

Installing the killer app: CNG fueling for vehicles

Taking advantage of the potential gains from CNG as a transportation fuel requires simultaneous action in two areas: vehicles and fueling infrastructure.
Vehicles using natural gas for propulsion are not new. However, due to the recent reduction in US natural gas costs, increased utilization of natural gas in vehicles, from small cars to the trucking fleet of nearly 6 million rigs cruising North America’s roads, offers the possibility for the development of a continental energy system both buttressing the existing energy infrastructure and producing immediate cost savings for vehicle operators.

CNG utilization in vehicles requires either conversion of existing vehicles or purchase of new CNG vehicles. Many conversion kits are available to convert passenger cars to CNG, and one manufacturer produces a CNG sedan. These vehicle remain significantly more expensive than traditional gasoline or diesel fueled cars.

However, converting from diesel to CNG is especially attractive for heavy duty trucks. Trucking operational costs, due to environmental pollution mitigation requirements as well as the price of diesel, are steadily increasing. CNG is much cleaner burning than is diesel, and the addition of natural gas storage tanks can actually reduce the overall weight of the truck (a normal load of diesel is heavier than full CNG tanks).  CNG as a vehicle fuel has many advantages - lower cost compared to gas and diesel and diminished negative environmental impacts (lower NOx, CO2 and particulates per gallon used compared to gasoline and diesel); in addition dual fuel conversion kits that allow the truck to run on CNG and diesel are also available for approximately $20,000 installed, enabling trucks to take advantage of CNG where it is available and diesel when necessary. Nationally, CNG costs approximately $2.20 gasoline gallon equivalent (GGE) while the average cost of regular gasoline is $3.54 and that of diesel is $3.87.

Fueling infrastructure

However, the second part of the CNG transportation equation is the fueling infrastructure. A lower priced, but physically unavailable fuel is no bargain. Service station based CNG fueling infrastructure is expanding in the US, and it is now possible to travel coast to coast on CNG filling up at public stations. However, for many heavy duty vehicle users on site refueling makes the most sense, both in terms of cost and ensuring that the fueling process supports work activities. For example, large trucks that operate during the day, and come back to a central facility for storage in the evening, like recycling trucks, are perfect candidates for slow fill systems. These systems can operate at lower compression rates and do not require the same expensive storage tanks as “fast fill” systems where one simply drives up and pumps CNG in the same way one fills up with diesel or gasoline.

Microgrid integration

CNG use as a vehicle fuel thus has the potential to be the “killer app” of the CNG powered microgrid. How would this work?  On a CNG powered microgrid, the addition of CNG storage tanks, a compressor (either powered by CNG from the pipeline or the electricity from a local generator or the grid) and a pump creates a CNG vehicle fueling system. The CNG powered generator set could provide power to both the microgrid, and as part of that microgrid, the CNG compressor providing fuel for the CNG pumping station. The enterprise CNG capability would thus provide backup power in an emergency, daily load balancing for distributed renewable energy generation and vehicle fueling services. In addition, a CNG generator can provide a steady source of electricity for electric vehicles. So for example a flexible fuel plug in hybrid vehicle could receive power from a CNG powered microgrid even if the electrical recharging terminals were inoperable and the gas stations at which it normal fueled up with methanol, E85 or gasoline were inoperable due to a lack of electricity. 

Fuel flexibility

While not a total fuel flexibility solution, (methanol, liquefied natural gas (LNG) and autogas or propane (LPG) are also important additions) CNG can contribute to increasing fuel flexibility of the North American transportation system, thus reducing current vulnerabilities (supply, cost, environmental) resulting from reliance on gasoline and diesel. This is not to say that CNG is the full answer to increasing transportation fuel diversity. As pointed out in Petropoly, the imperative to make the minor adjustments to current engines that would enable them to run on alcohol based fuels, including methanol (which can be produced from natural gas as well as coal) remains valid. Flex fuel plug in hybrid vehicles, electric vehicles, bicycles (and networks of bike lanes), telecommuting and mass transit all have their place in the market.

Energy security challenges

For countries with sufficient natural gas supplies (a rapidly growing group) the domestic sourcing of natural gas is a major advantage from the energy security perspective. Yet using the natural gas pipeline system as the backbone of a microgrid based distributed system still requires two sets of activities to effectively and efficiently increase energy security.

First, the CNG production, storage and distribution systems must be hardened against cyber and EMP attacks. This is a big challenge. However, once a well is drilled and producing, much of the equipment is underground. Shielding the remaining components is not an insurmountable challenge. Safe CNG storage is less challenging than it might be if the gas were, for example, dependent upon electricity for secure storage in specially cooled tanks because most natural gas is already stored in underground formations. In the absence of electricity the natural gas simply stays in place both in storage and the pipelines – in the case of failure the system fails to a stable state. 

The CNG pipeline system is the most vulnerable element of the CNG system of systems. Hardening this system against cyber attacks and atmospheric disruptions is a significant challenge, but is smaller than hardening the entire electrical grid, which as it is becoming smarter is growing more vulnerable. How can we cost effectively increase the anti-fragility of the CNG grid? Through two practical steps.

Practical steps
Keep the parallel natural gas grid stupid
A “stupid” or “isolated intelligence” compressed natural gas grid can provide secure energy to a system of system of microgrids, capable of operating in “island mode” to provide electricity and fuel (to both electric and CNG capable vehicles) when the main electrical grid is down. Stupidity refers to abandoning the gains from connecting the pipeline system to the normal internet, an internet which poses many risks to Systems Control and Data Acquisition (SCADA) systems. Delinking the current SCADA systems from the internet and instead building an isolated intelligence monitoring and management system would impose additional costs. However, the reduced vulnerability and ability to fuel a widespread distributed network of microgrids providing critical security and business functional continuity even in a major crisis is worth the expense especially since such infrastructure system isolation from the grid by the private sector would remove the necessity for the government to develop the capabilities to perform the isolations.

Build anti-fragile microgrids
Hardening against damage caused by EMP will also protect against geomagnetic storms and other atmospheric threats. Such hardening has costs but also clear benefits. Not only will such hardening protect against the extremely rare EMPs and geomagnetic storms (though the storms may be increasing in frequency – we lack a sufficient sample size to make informed judgments) it will also increase anti-fragility in the face of extreme weather events. The hardening should thus be viewed not as an unusual and exorbitant expense to protect against a “Black Swan” but as the prudent minimum. Standardization of CNG distributed energy generator sets, compressors and storage system layouts will facilitate mass production of the grounding, shielding and filtering products necessary for effective shielding - reducing costs through economies of scale.

Enhancing the CNG parallel grid frees us in part from the need to bear the massive economic losses caused by grid disrupting events. With appropriate preparation, as we work to harden our entire electrical system through equipment replacement and improved design, we could protect our critical infrastructure and key service nodes (police, medical centers, sewage treatment plants, ports) relatively quickly.  Companies could even use the CNG EMP hardened microgrid as a revenue generator, selling guaranteed access to the power as a form of insurance or offering options contracts in the event of a casualty that disrupts the main grid. A hotel or hospital buying microgrid access options contracts would provide a small source of income to help defray the hardened microgrid costs, while the provision of power during a crisis would contribute both profits and a vital public service.


In a world in which grid reliability, due to weather, cyber threats, solar flares and EMP is coming into increasing question we need to think through the need to adjust our electricity production paradigm.  The proposition that the current electrical grid is down due to a massive human or nature induced cascading causality provides a useful starting point from which encourage engagement in this project.

The enhanced parallel CNG stream powering microgrid “islands” can provide electricity and vehicle fueling services independently of the electrical grid. Reaping the financial gains accruing from increasing natural gas utilization as a vehicle fuel can incentivize increased natural gas use in distributed power generation in conjunction with renewable sources. Building these capabilities with an eye to EMP protection offers a challenging, but achievable contribution to increasing the anti-fragility of the North American power system. The technical challenges and costs of developing such a capability are far smaller than the damage not only our economy, but civilization, would suffer as a result of massive degradation of the electricity system.

Contributor Mike Hallett has worked as a consultant to E3 Energy specifically in the area of alternative fuels.  He is presently engaged by Site Design Associates, a civil engineering and investigative engineering firm in San Diego, California



US Energy Security Council RT discussion

New Books

Petropoly: the Collapse of America's Energy Security Paradigm
Energy Security Challenges for the 21st Century

"Remarkable collection spanning geopolitics, economy and technology. This timely and comprehensive volume is a one stop shop for anyone interested in one of the most important issues in international relations."
U.S. Senator Richard G. Lugar

"A small masterpiece -- right on the money both strategically and technically, witty, far-sighted, and barbeques a number of sacred cows. Absolutely do not miss this."
R. James Woolsey, Former CIA Director

"The book is going to become the Bible for everyone who is serious about energy and national security."
Robert C. McFarlane, Former U.S. National Security Advisor
Russian Coal: Europe's New Energy Challenge