Richard Meyer Natural Gas Market Indicators: April 15, 2015

A new study from Washington State University shows that methane emissions from U.S. natural gas distribution systems are 70 percent below current Environmental Protection Agency (EPA) estimates of those emissions. Based on data collected from pipeline leaks, meter and regulator stations, and city gates within 13 utility systems across the country, the study’s authors found that emissions from local distribution companies (LDCs) have decreased over the past 20 years due to upgrades, changes in pipeline materials, and better leak detection and survey methods.

As we often report here in the “Market Indicators” blog articles, industry experience and performance exists on a spectrum – one that is often improving in terms of practices and technologies, as well as the regulatory precepts that oversee these activities. This study demonstrates improvements to gas utility system safety and environmental performance, but it is also part of a larger industry trend of better overall performance.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

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Christina Nyquist New Report Shows Growing Natural Gas Resources: Four Things You Need to Know

On Wednesday, April 8, AGA announced the findings of a new report detailing the nation’s supply of domestic natural gas. Compiled by the Potential Gas Committee, the year-end 2014 report Potential Supply of Natural Gas in the United States, shows that future U.S. gas supplies are at their highest level ever and continue to grow. This means the nation’s domestic abundance of natural gas can continue to support customer savings, economic growth, energy security and increased efficiency and environmental solutions.

AGA_3110-Potential-Gas-Committee-Map-V-3-WEB

Here are four things you need to know about the latest natural gas numbers.

Record Supply

  •  According to the Potential Gas Committee, U.S. technically recoverable natural gas resources are estimated to be 2,515 trillion cubic feet (Tcf) as of year-end 2014 – a five percent increase since the year-end 2012 report.
  • The U.S. Energy Information Administration (EIA) estimates that domestic dry proved natural gas reserves have doubled since 1993, and are now estimated at 338 Tcf. Proved reserves are volumes of natural gas known to exist that have been proven by exploration and development operations.
  • When combined with EIA proved reserves estimates, the U.S. future supply of natural gas now exceeds 2,850 Tcfthe highest combined future supply of natural gas ever.

Savings for Consumers

  •  Households that use natural gas for heating, water heating, cooking and clothes drying save an average of $693 per year compared to homes using electricity for those applications.
  • Strong supply fundamentals and robust delivery infrastructure suggest that natural gas prices will remain competitive and stable at a level well below the peak market prices of the preceding decade.
  • Low domestic natural gas prices have led to savings of almost $30 billion for residential natural gas customers over the past five years.
  • In 2013, the average commercial customer saved more than $2,000 on their annual bill due to low natural gas prices compared to 2008.

Direct Use of Natural Gas is the Efficient Choice

  •  Natural gas is 92 percent efficient when used directly in homes and businesses.
  • Customers can unlock greater savings by working with their local utility to make efficient energy choices.
  • In 2013, local utility efficiency programs helped customers reduce their annual natural gas usage by an average 18 percent and save $137 in annual energy costs, while offsetting 7.9 million metric tons of carbon dioxide emissions.

Expanding Access, Enhancing Safety

  •  To ensure that more Americans can safely enjoy the benefits of domestic natural gas, local utilities are working with governors, legislators and state regulators around the country to upgrade, enhance and expand the nation’s more than 2.4 million miles of natural gas infrastructure.
  • By investing in our energy future and advancing smart policy to enhance safety and expand infrastructure, customers can look forward to continued market stability, reliable service and affordable prices.

For more information, visit www.aga.org/PGCReport.

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Lisa O'Leary Advocates Urge Congress to Increase LIHEAP Funding

Nearly 200 advocates from across the United States converged on Capitol Hill last week to support responsible funding for the Low Income Home Energy Assistance Program (LIHEAP). The National Energy and Utility Affordability Coalition (NEUAC) sponsored LIHEAP Action Day 2015 along with member companies of the American Gas Association (AGA) and the Edison Electric Institute. The annual day-long event is aimed at building awareness for LIHEAP, a federal block grant program providing financial assistance to low and fixed-income individuals for fuel and utility bills, as well as low-cost weatherization and energy-related home repairs.

Representatives from Entergy and Atmos Energy met with Sen. Roger Wicker’s (R-MS) staff to discuss LIHEAP funding. Photo Credit: Entergy

Representatives from Entergy and Atmos Energy met with Sen. Roger Wicker’s (R-MS) staff to discuss LIHEAP funding. Photo Credit: Entergy

According to NEAUC, nearly 300 meetings took place between LIHEAP advocates and members of Congress and their staff, to discuss the need for at least $4.7 billion in LIHEAP funding for FY2016. Advocates in D.C. and throughout the country also took to social media to share important messages about LIHEAP by using #LIHEAPAction.

After many years of underfunding LIHEAP, Congress funded the program at $5.1 billion in FY2009 and FY2010. Since then, funding has declined by almost $1.7 billion and recipients have seen their assistance grants reduced by nearly $95, impacting the program’s effectiveness.  The average grant was estimated to cover less than half of the average home heating costs for a household this winter, meaning that many low-income families and seniors had fewer resources available to meet other basic needs.

This winter was especially hard-hitting in the northeast and southeast with record-breaking snowfall and cold temperatures, serving as a stark reminder of why the LIHEAP program is so critical. Here are just a few other reasons:

  • More than 35 million U.S. households meet LIHEAP’s federal eligibility criteria, yet only 6.8 million households were helped in 2014.
  • States and their charitable partners can serve households earning up to 150 percent of Federal poverty guidelines or 60 percent of median income. For a three-person family in the U.S., that’s less than $29,685, yet most LIHEAP households earn less than that amount.
  • Even with LIHEAP funding at $5.1 billion, the amount was only enough to assist 1 in 5 eligible Americans.
Rep. Peter Welch was presented with this year’s NEUAC Extra Mile award. Photo Credit: http://welch.house.gov/

Rep. Peter Welch was presented with this year’s NEUAC Extra Mile award. Photo Credit: http://welch.house.gov/

LIHEAP Action Day concluded with a Congressional reception and the presentation of the NEUAC Extra Mile award given to Rep. Peter Welch (D-VT), recognizing him for his longtime support of the program. In a letter to the House Appropriations Committee penned by Rep. Welch and Rep. Peter King (R-NY), more than 145 lawmakers stressed the critical importance of full funding of LIHEAP.

AGA had to opportunity to interview several advocates in attendance of the LIEAHP Action Day Breakfast. Stay tuned for links to those video interviews next week.

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Richard Meyer Natural Gas Market Indicators: March 27, 2015

After natural gas consumption records were set for the nation as a whole during the first quarter of 2014, the same period in 2015 brought a mixed bag of market observations. Although there was no polar vortex, it did get cold, primarily in the central and eastern U.S. and particularly in February. Consumption in the residential/commercial sector was down about four percent, however, consumption in the power generation sector was up 15 percent for the first quarter of 2015 compared to 2014, even with all of the records set last year.

Some of that demand increase was structural with shifts in the power source energy mix, while some was due to the relatively low and competitive price of natural gas versus coal in the marketplace. The supply picture remains strong today with hundreds of Bcf more working gas remaining in storage compared to March 31, 2014. Domestic production growth seems to be slowing – all indicators of a market seeking balance.

Visit this link to download the full Natural Gas Market Indicators report. Topics covered in this week’s report include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Shale Gas, Rig Counts, Pipeline Imports and Exports, and LNG Markets.

Please direct questions and comments to Chris McGill at cmcgill@aga.org or Richard Meyer at rmeyer@aga.org.

Posted in Natural Gas, Natural Gas Market Indicators, weather | Leave a comment