Task Force Finds Potential for Increased Natural Gas Price Stability
Washington, D.C. - The American Gas Association (AGA) and the American Gas Foundation (AGF) recently participated in the release of a national producer and consumer task force report titled The Task Force on Ensuring Stable Natural Gas Markets, which points to the potential for increased domestic natural gas price stability based on the growing availability of gas from shale formations, a diverse portfolio of contracting options and expanding infrastructure. The task force, of which AGA is a member, was convened by the Bipartisan Policy Center (BPC) and the American Clean Skies Foundation (ACSF).
From shale gas discoveries onshore to new gas fields offshore, our nation has significant supplies of clean energy that will power our economy affordably for generations to come an anticipated 100 years, said Dave McCurdy, president and CEO of AGA. As crude oil prices continue to rise, stability with regard to natural gas pricing is welcome news to homeowners, small business owners and larger commercial manufacturers across the country.
The American Gas Foundation welcomes the recommendation of this broad and diverse task force representing all natural gas stakeholders including the recognition that long-term contracts and hedging programs are valuable tools to manage natural gas price risk, said Jay Copan, American Gas Foundation executive director.
The report calls on governments to encourage the development of domestic natural gas resources, subject to appropriate environmental safeguards. The report notes that the efficient use of natural gas has the potential to reduce harmful air emissions, enhance energy security and improve the prospects of U.S.-based, energy-intensive manufacturing.
We have a good problem, said task force Co-Chair Norm Szydlowski, a member of the Bipartisan Policy Center and president and CEO of SemGroup Corporation. Finding more natural gas provides an opportunity that is as much unparalleled as it was unexpected. Fundamental changes that have taken shape in the domestic supply and demand balance for natural gas, including an unprecedented level of available storage and import capacity, should allow markets to function more efficiently and fluidly in the future, said Szydlowski.
AGA recently unveiled an Energy Analysis showing that customers currently are benefitting from the sustained, stable production of domestic natural gas. This new task force report points out the real potential for continuing that development.
With a more stable price horizon for natural gas, the report urges state public utility regulators and industry officials to examine the possibility of making greater use of longer term supply contracts. Rules that unnecessarily restrict the use of, or raise the cost of, long-term contracts and hedging tools for managing supply risk should be avoided, the report states.
For more details and the comprehensive set of recommendations included in the report, please visit: http://www.bipartisanpolicy.org/library/report/task-force-ensuring-stable-natural-gas-markets-final-report.
Bolstered by Increased Supply and Diverse Contracting Tools