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Pennsylvania PUC Finds Electric Power Generation Guzzling More NatGas

The shift in the use of natural gas in Pennsylvania from residential and industrial consumption to electric power generation has been dramatic, with the trend accelerating around 2008 when Marcellus Shale production began to ramp up, according to a report from the state Public Utility Commission.

Overall, total natural gas consumption in Pennsylvania increased from 706.2 Bcf in 1997 to 1.09 Tcf in 2013, according to the PUC's latest natural gas outlook report. Total gas consumption for electric generation also increased sharply during that time, going from 21 Bcf to 414 Bcf by 2013.

"It is important to note that although the share of natural gas going to different end uses has shifted, all uses other than power production have remained rather steady," the PUC said. "The resultant increase in electric generation has come from an increase in the total amount of gas being delivered in Pennsylvania, not a shifting of resources away from other uses."

The increase in natural gas deliveries for power between 1997 and 2013 increased electric generation's share of total state usage from 3% to 38% during that time, the PUC found.

The report was compiled using data filed annually by the state's natural gas distribution companies and the U.S. Energy Information Administration. There are 2.8 million natural gas customers in Pennsylvania, of which 2.6 million are residential customers. By the end of 2013, the state had 10,033 MW of natural gas-fired generation, which made up 24% of the state's generating capacity, while coal still made up 35%.

Unconventional production from the Marcellus Shale went from 2.04 Tcf in 2012 to more than 4.4 Tcf last year (see Shale Daily, April 1; March 6, 2013). While estimates vary, the PUC said nearly 12 Bcf/d of pipeline projects are slated to come online this year in the Northeast to help move gas to market. Additionally, more than 10 gas-fired power plants have either been proposed in recent years or are currently under construction in the state, which is likely to continue increasing electric power generation's share of gas consumption (see Daily GPI, May 27; Feb. 18).

"The fraction of natural gas usage for electric generation has dramatically increased. Reasons for this increase include more supply of natural gas and the resultant lower cost for natural gas, the advancement of efficient natural gas generation technology and retirements of older coal-fired plants," the PUC said. "As the composition of the generating fleet changes to more gas-fired units, pressure on the natural gas industry to augment production and transportation capacity will continue to increase."

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