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Substantial Increase in Winter Natural Gas Prices Predicted
Salem, Ore. If you use natural gas, brace yourself for an expected sharp rise in prices. That was the collective opinion shared Tuesday in a briefing before the Oregon Public Utility Commission by natural gas providers in Oregon.
The Commission was told that natural gas prices this coming heating season will likely be significantly higher than a year ago due to growing demand, tight supplies and international pressures as Oregon’s natural gas companies secure supplies for their customers for the next year and beyond.
Commission gas analyst Ken Zimmerman said, “This is very much the opposite of what we saw last year.” “Demand is robust while supplies remain tight. As a result wholesale prices are significantly higher than a year ago.”
NW Natural expects prices to be 35 to 40% higher, Avista Utilities 10 to 15% and Cascade Natural Gas15 to 20% higher than a year ago.
“This is sobering news given the other economic pressures consumers are already facing on other fronts,” Commission Chairman Lee Beyer said. “I can’t urge strongly enough that customers should to start thinking now about how they can use less natural gas this coming winter.
By comparison, in 2007 the Commission reduced NW Natural’s rates for residential customers by 8% and 1.3% for Avista Utilities. Cascade’s rates rose by just under 1%.
Wild cards that could drive natural gas prices higher include the hurricane season and any unforeseen gas pipeline disruptions.
Oregon’s supply of natural gas comes from Canada and the Rocky Mountain region.
NW Natural Gas, Avista Utilities, and Cascade Natural Gas will file requests with the Commission in late August to adjust their rates as part of the annual Purchased Gas Adjustment (PGA). The annual adjustment allows companies to pass through their actual cost of purchasing gas to customers.
Commission staff will analyze the requests and the Commission will make a decision. Customer rates would change effective November 1, 2008.
NW Natural serves customers in Northwest Oregon. Avista Gas serves portions of Southwest and Northeastern Oregon while Cascade Natural Gas serves Central Oregon in the Bend region and parts of Northeast Oregon.
Roughly 715,000 Oregonians receive natural gas from either Northwest Natural Gas, Avista Utilities or Cascade Natural Gas.
Contacts: Lee Beyer, Chairman, 503 378-6611; Ray Baum, Commissioner, 503 378-6611; John Savage, Commissioner, 503 378-6611; Bob Valdez, Public Affairs Specialist, 503 378-8962 Salem, Ore.
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Notice: No cry for foreign LNG and its pipeline.
Natural gas is our country’s second largest energy resource and a vital component of our energy supply. 98% of …
LOL, yes, Patrick I know the phrase. I was poking the point that this horse was beaten to death and it was ressurected to get killed over and over like …
By Rick Balkins from the article Where are you getting 4-131 info?.On Sep 5, 6:31 PM, Rick Balkins wrote:
Anyway, I voted how I feel about the issue whether you agree or disagree with me, I’m not going to …
By Patrick McGee from the article Where are you getting 4-131 info?.Who’s truths or lies are you believing is the nature of this question.
I believe from my standpoint that LNG might be good but I’d be interested in …
By Rick Balkins from the article Where are you getting 4-131 info?.I get mine from “Clatsop County”, “The Daily Astorian”, “KAST Coastwatch","Peter Huhtala” and of course, “Grass Roots People”.
What convinced me to vote the way I did?
… By Patrick McGee from the article Where are you getting 4-131 info?.
5 Comments
On Jul 16, 10:01 PM, wondering wrote:
What happened to ODE’s perdiction that Canada had more gas for us?
On Jul 17, 4:19 AM, Richpix wrote:
Do you think importing LNG is going to make prices go down?
The pace of deliveries of liquefied natural gas (LNG) imports remains considerably below last year’s volumes. Deliveries are estimated to have been less than 200 Bcf for the first half of the year, which is less than half of the approximately 460 Bcf received last year during the same time period. Most flexible LNG cargoes are heading to Europe and Asia, where buyers continue to purchase LNG at prices higher than those that have prevailed in U.S. markets.
http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp
It wouldn’t matter how much natural gas Canada has for us, we’re currently not experiencing a shortage. The problem is NG prices are tied to oil prices and speculators have driven the price up.
On Jul 17, 12:54 PM, Ben wrote:
“Demand is robust while supplies remain tight.” If that doesn’t mean a shortage what does it mean?
According to PUC the initial higher price will soon resolve itself by a more consistent market. The more we consistently buy, the less we will have to pay. The higher volume being purchased will negate the need for higher prices per one time, spotty, deliveries.
I do not expect the price to “plummet” but at the rate that it is soaring without the option of imported LNG I do not see Canada as holding their prices down, and given where the gas is in the ROckies and the price it will cost to get at it I don’t foresee that as being a less costly venture either.
The speculators who are banking on wind have lost their investments repeatedly, as can be seen in the now three abandoned projects in Oregon. Newly proposed windmill farms are being fought in the Columbia Gorge. Nuclear plants are not politically acceptable. It honestly seems that many members of environmental groups are so rich and comfortable where they are at they do not care which direction the country goes in the future as long as they create enough chaos that politicians are frightened to take a step in any direction.
On Jul 17, 2:23 PM, Richpix wrote:
“Demand is robust while supplies remain tight.” If that doesn’t mean a shortage what does it mean?
It means prices were high and less natural gas was put in storage for the peak demand winter months. There was no shortage of NG, only a shortage of buyers. This week the price plunged and storage is up beyond expectations:
The immediate cause of Thursday’s sharp natural gas decline was a larger-than-expected build of U.S. supplies.
The Energy Department’s Energy Information Administration said in its weekly report that natural gas inventories held in underground storage in the lower 48 states rose by 104 billion cubic feet to more 2.31 trillion last week. Analysts had been expecting supplies to grow by only 86 billion to 91 billion cubic feet, according to a Platts survey.
Oil tumbles below $130; natural gas falls sharply
On Jul 19, 12:10 AM, Ben wrote:
You think those supplies are going to be released into the pipelines coming over the Rockies to us? No, our supplies are in a shortage. Those supplies will come out in an emergency, or when it is politically expedient for them to do so.