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Natural Gas Allocations Crucial
Recently the National Journal’s Energy and Environment Experts blog asked, “The Nitty-Gritty: What Will Hearings Offer?” in reference to the Kerry-Boxer bill. You can read Dave Parker’s response below and follow this link to see what others are saying.
The American Gas Association (AGA) commends Congress for keeping a spotlight on our nation’s energy issues by giving careful consideration to several different bills on the table right now, including Kerry-Boxer. By recognizing the role that clean, domestic and abundant natural gas can and will play in combating climate change, our legislators can help reach our nation’s energy goals sooner.
AGA also urges members of Congress to take a look at the successful track record of America’s natural gas utilities and their customers. During the past 40 years, while the number of natural gas customers has doubled, actual gas use and greenhouse gas emissions have remained essentially flat. This remarkable success in both reducing natural gas usage on a per-household basis and increasing appliance efficiency should be considered when crafting a national energy strategy. Instead of simply mandating arbitrary prescriptive requirements, a far more effective course of action would be to continue to support these proven and successful approaches.
We believe that natural gas could, and should, be used as a tool to improve environmental quality and energy efficiency. To that end, AGA believes that as lawmakers craft climate change and energy legislation, the following key points should be considered.
If a cap-and-trade approach is implemented, Congress should maintain or increase the four-year delay for natural gas utilities coming under that program, while increasing their allowance allocation from nine percent to 12 percent and extending their allocated allowance phase-out from 2030 to 2040. Congress should also significantly modify or delete the provision that stipulates one-third of the value of allowances allocated to natural gas utilities should go to energy efficiency programs, as this approach will not reduce emissions and will only raise costs. In addition, Congress should treat all renewable energy sources equally, whether they are used to generate electricity or supplement natural gas supplies.
An approach to reducing emissions that is focused on appliance efficiency standards, building codes, and utility-supported conservation/efficiency programs has a proven track record for residential and commercial natural gas customers. AGA asks that Congress strengthen this approach rather than impose the higher costs and greater uncertainties that would result from a cap-and-trade approach.
Natural gas energy supply: the real deal for America
America, let’s take an accounting of the latest instruments of facts that point to a fundamentally strong position in the United States for short- and long-term natural gas supply, as we debate our low-carbon energy future.
- The year-end 2008 Potential Gas Committee (PGC) report of estimated natural gas resources in the United States points to more than 1,836 trillion cubic feet of potential resource evaluated. It is the largest aggregate estimate presented by the PGC in 44 years.
- The Energy Information Administration just published their accounting for known reserves of natural gas, yesterday, October 30. The 245 Tcf reported is the largest volume ever identified by EIA, since they began keeping the reserves statistics in 1977. In addition, the volume of domestic gas production recorded in 2008 (20.5 Tcf), according to EIA, was the largest annual production number since 1974.
- Combining PGC Resources and EIA Reserves results in a volume of future supply of over 2,000 Tcf – 100 years or more of supply at current production levels.
- In the shorter-term, natural gas storage is at record levels and, in fact, the ability to store gas underground has grown, also.
These are not short-term phenomena. They are indications that natural gas is poised to serve a growing market of low-carbon fuel requirements.
America, this is the real deal.
Natural gas market indicators
In keeping with the supply asset theme from the previous market indicators report, the Interstate Natural Gas Association of America released a report on October 20, 2009 that examines estimated midstream infrastructure requirements under various market scenarios. The report points to $130-240 billion that may be spent on midstream assets between now and 2030 ($6-10 billion per year) with about 80 percent targeting natural gas transmission pipelines.
Most of the pipeline infrastructure is suggested to connect new gas supply rather than to meet specific consumption increases. Two additional interesting components of the outlook include $50 billion in expenditures for connecting arctic gas to the North American grid and a baseline expectation of consumption growth to more than 31 Tcf per annum by 2030. This view is more aggressive for natural gas demand than the current Energy Information Administration outlook, which doesn’t exceed 25 Tcf by 2030.
In the near term, economic data suggests that we may soon see an end to the “official” recession, with a positive reading on third quarter Gross Domestic Product. Economic fundamentals (and their resulting impact on demand) have been a bit of a wild card in recent months, and if the economy heats up we may see renewed tightness in the supply/demand balance.
Visit this link to download the full Natural Gas Market Indicator. Topics covered include: Reported Prices, Weather, Working Gas in Underground Storage, Natural Gas Production, Rig Counts, Pipeline Imports and Exports, and LNG Markets.
True Blue Natural Gas Blog from the American Gas Association (AGA)- Diversification of natural gas supply is an essential consumer protection
- From Austin to Boston in a natural gas vehicle
- Natural gas, how about zero carbon emissions
- The real natural gas message in a climate crunch
- Let’s work together to protect our seniors
- Natural Gas Market Indicators
- Coming Down To Earth on a ‘Clean Energy’ Standard?
- The convenience of the natural gas fireplace
- Coming Down To Earth, A Winning Strategy For Renewables
- Energy Secretary Chu Identifies Natural Gas as Key to a Low-Carbon Future
