As we explore the use of natural gas, it’s important to look at the trend and projections of natural gas and the energy market. According to the Energy Information Administration’s (EIA) Annual Energy Outlook 2014 report, natural gas grows by an average rate of 1.6% per year from 2012 to 2040.
Consumption of natural gas grows in the industrial sector by about 2 Tcf and electric power sector by about 2.5 Tcf. These increases in consumption are based on low natural gas prices and the ability of natural gas to replace retired coal-fired power plants.
Across the board, natural gas is projected to increase for end-users except in the residential consumption sector. This slow gradual decrease is expected with improvements in appliance efficiency and as populations shift towards warmer regions.
The top four electric associations to increase in consumption in the electric power sector are SERC Reliability Corporation (SERC), Reliability First Corportation (RFC), Western Electricity Coordinating Council (WECC), and Texas Reliability Entity (TRE). SERC and RFC's projected consumption in natural gas increases due to the retirement of coal-fired power plants. WECC and TRE's projected natural gas consumption increases due to projected growth in electricity demand.
Where will the natural gas come from, you might ask? Well, the EIA projects that natural gas will come primarily from Shale Gas with a 56% increase from 2012-2040.
EIA's overall projections for natural gas look good. Looking at the projections, can you see natural gas a a viable fuel for the future? What other factors may influence these trends?
My next blog post will cover the proposed EPA’s Clean Power Plan, and how that may affect natural gas production and consumption.
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