“The recent low prices for natural gas that we have seen are good news for our customers, residential, as well as in commercial and industrial markets,” Borgard said. “Natural gas is an abundant, domestic and clean energy source. Our industry creates millions of jobs. There are exciting opportunities to expand the applications of natural gas, including greater direct use in homes and businesses, as well as in the transportation sector with natural gas vehicles. Natural gas is the future of the energy industry, and by extension our economic future.”

During this continued period of stagnant economic growth, shareholders of natural gas utilities have seen consistent and strong dividends. Most natural gas utilities have paid dividends continuously for more than 50 years. Over the past year, the AGA Index (an index consisting of member companies of the American Gas Association) performed strongly in comparison with the Dow Jones Utility Index.

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This country needs an all-out, all-of-the-above strategy that develops every available source of American energy a strategy that’s cleaner, cheaper, and full of new jobs.

We have a supply of natural gas that can last America nearly 100 years.  And my administration will take every possible action to safely develop this energy. Experts believe this will support more than 600,000 jobs by the end of the decade. And I’m requiring all companies that drill for gas on public lands to disclose the chemicals they use, because America will develop this resource without putting the health and safety of our citizens at risk.

The development of natural gas will create jobs and power trucks and factories that are cleaner and cheaper, proving that we don’t have to choose between our environment and our economy.

This is the first time in recent memory that a President of the United States has mentioned natural gas so prominently in such a public forum.  Natural gas is the right fuel in the right place at the right time.

We are pleased by President Obama’s strong support for America’s foundation fuel, and hope the he will incite action following his State of the Union remarks by putting in place policies that expand the use of natural gas, so that every American and our nation as a whole can benefit from this clean, abundant, domestic resource.

1.      Natural gas production rises over projection period and shale comes to represent half of all dry gas production.

EIA sees shale as a growing and increasingly important resource of natural gas for the county; that there is a lot of gas, and it will be produced. In EIA’s view, shale gas is expected to grow to nearly half of all natural gas production by 2035, spurred by new technology, and a greater push toward more liquids-rich plays due to higher oil prices.  In the last few years, natural gas production from shale has propelled from nearly nothing to 5.0 trillion cubic feet in 2010, making it 23 percent of all U.S. gas production that year.  Data for 2011 indicates that shale production grew again last year. In the outlook, EIA sees continued growth in shale gas production, increasing to an incredible 13.6 trillion cubic feet in 2035, making it 49 percent of the total U.S. dry gas production.  

U.S. Natural Gas Production, 1990-2035 (trillion cubic feet)

Natural gas consumption is projected to grow also.  More gas will be used for electricity generation, the greatest area growth of gas consumption according to EIA. The agency remains bearish on natural gas for transportation and distributed generation applications like combined heat and power; certainly, natural gas consumption will grow more than EIA’s base case projection if these opportunities are realized. Yet, despite growth in natural gas use, production will exceed consumption. The resulting gap will be filled by greater exports of gas. Exports will increase as the U.S. becomes a net LNG exporter by 2016 and net pipeline exporter by 2021. What does this mean for natural gas prices?  EIA’s view is average annual wellhead prices will remain $5 per thousand cubic feet through 2023 and reach $6.52 per thousand cubic feet in 2035. This is still well below price levels seen only a few years ago.In sum, shale gas production will grow faster than end use consumption and the U.S. will move toward being a net shipper of gas to Canada and overseas. Despite this change in dynamics, prices will remain relatively low – which of course is good for consumers and industry here at home. 

2.       Total U.S. energy-related carbon dioxide emissions remain relatively flat and stay below 2005 levels through 2035.

 This strikes me as a remarkable departure from history. From 2010 to 2035, the outlook for energy-related greenhouse gas emissions projects a 3 percent increase in total emissions to 5,806 million metric tons. Why the flattening profile and lack of growth in emissions? Three reasons: 1) Energy efficiency improvements like the corporate average fuel economy standards (CAFE) and appliance and equipment efficiency standards will lower energy consumption.  Greater investment in this area could further accelerate these trends. 2) State renewable portfolio standards are increasing renewable build-out and, combined with efficiency improvements, are lessening the carbon intensity of the electric system. And 3) low-cost, competitive natural gas will be substituted for coal-fired electricity generation. New environmental regulations will drive more coal retirements.

Natural gas is our country’s foundation fuel and is well positioned to serve as a reliable, secure and clean energy source for U.S. homes, businesses and industries for decades to come. In an article in the recent issue of Oil & Gas Monitor AGA President and CEO Dave McCurdy outlines some of the ways Americans can utilize natural gas to improve our economy, reduce our impact on the environment and secure our nation’s energy future. Take a look.

Energy Biz did a terrific job of laying out for their readers the various options that neighborhoods, businesses and consumers have when choosing how to consume electricity, heat their homes, and cook their food.  Dave McCurdy’s article is alongside others by leaders in the energy industry.

I urge you to read them all and see why natural gas is emerging as a clear favorite as our nation strives for energy independence.  Natural gas can help meet the energy needs in all sectors – residential, commercial, industrial, electricity generation, and transportation – cleanly, economically, and efficiently.

According to a new report released by the American Council for an Energy-Efficient Economy (ACEEE), “Nationwide the budgets for these programs reached $942 million in 2010, saving 529 million therms-enough natural gas to take care of the needs of 695,000 average American homes. These programs have experienced rapid growth. In 2005 total budgets were $125 million nationwide.”

The report is jam-packed with information. It examines the structure, origins, funding, and impacts of natural gas efficiency programs for the forty-one states where they are in place. For instance, if you live in California, it includes information on the programs offered by Pacific Gas & Electric (PG&E), Southern California Gas Company (SCG), and San Diego Gas & Electric Company (SDGE).

The entire report is downloadable for free on the ACEEE website.

The American Gas Association, (AGA), is very pleased to see this bill become law, as it will provide the regulatory certainty necessary for the pipeline industry to make critical investments and create American jobs. The bill authorizes funding for programs of the Pipeline and Hazardous Materials Safety Administration (PHMSA) through fiscal year 2015. PHMSA oversees safety programs for the 2.3 million miles of natural gas, petroleum, and other hazardous liquid pipelines in the U.S.

America’s system of pipelines – the largest in the world – serves as the arteries of the nation’s energy infrastructure, enabling the safe, efficient and economical movement of extraordinary quantities of energy to industry and consumers, literally fueling the U.S. economy. Since 1986, the volume of energy transported through pipelines has increased by one-third, yet the number of reportable incidents has decreased by 28 percent. Government and industry have taken steps to improve pipeline safety, and the Pipeline Safety, Regulatory Certainty, and Job Creation Act helps ensure that we continue the nation’s commitment to making this safe form of transportation even safer.

The legislation went into effect immediately upon the president’s signature, and we can’t think of a better way to start 2012 than with this critical legislation being signed into law.

For more details and to view the bill, click here.

More from the release:

“The production of renewable natural gas is a major milestone that will allow us to provide sustainable energy from local agricultural products that were previously discarded or shipped out of state,” said TGC’s president and CEO, Jeffrey Kissel.

Because Hawaii relies on imported petroleum for approximately 90 percent of its energy – more than twice as much as any other state – Hawaii’s state government launched the Hawaii Clean Energy Initiative in 2008, calling for 70 percent clean energy by 2030. The Gas Company is working toward producing half of its gas from renewable and sustainable sources.

The new facility transforms fats and oils in a process that uses the heat from its existing gas production facilities, surplus hydrogen and steam to produce renewable natural gas and biofuels.

The renewable natural gas and biofuels that the RNG pilot plant produces will be incorporated into The Gas Company’s existing manufacturing and distribution operations. Renewable natural gas will displace gas produced from petroleum and will be distributed through The Gas Company’s 1,100-mile Oahu pipeline network. The cost for renewable natural gas should be the same as or less than gas produced from current sources, without relying on taxpayer subsidy.

You can read the full release here.

The savings have been passed on to their customers.  Today, the American Gas Association released their Natural Gas Efficiency Programs Report for 2010 which shows that through these programs, customers saved $62 per household last year.

Natural gas utilities provide valuable tools, incentives and information to help their customers understand and reduce their energy usage, including:

• Low‐interest financing, cash rebates and other financial subsidies for high‐efficiency natural gas appliance purchases and whole home or building efficiency improvements
• Home energy audits, weatherization kits, programmable thermostats, and telephone hotlines
• Information on insulation and high‐efficiency appliances
• Experienced and reliable appliance and service providers
• Web‐based information resources and energy usage calculators

Improvements like tighter‐fitting windows and doors, better insulation, and increased attention to thermostat control can translate into big energy savings.  In fact, customers that lower their thermostats by 10 to 15 degrees for eight hours a day can save 5 to 15 percent on their energy bill.

This 2012 energy outlook looks forward through 2040, whereas last year’s Exxon report projected demand through 2030.  The report is accompanied with helpful imagery depicting a sizable and expanding green chunk of the global energy demand space becoming occupied by natural gas, thanks to a combination of factors including abundant supply, expanding power demand, retirement of the coal fleet in certain countries, global greenhouse gas reduction efforts, and a tapering off in China’s population growth rate after 2030.

Shale gas is highlighted in the report as a source of global gas abundance on almost every continent — enough natural gas, according to Exxon, to last about two and a half centuries at current consumption levels.  Now, the trick is to harness this abundant, clean resource responsibly and sustainably to maximize benefits for consumers worldwide.