A combination of slackened demand and robust production will make natural gas supplies plentiful in the Pacific Northwest until 2029 at least, Spokane, WA-based Avista Utilities recently told regulators in the three states in which it has gas and electric operations.
Avista made the assessment in a natural gas integrated resource plan (IRP) for its utility operations in Idaho, Oregon and Washington. The combination utility characterized the outlook as good news for all of its utility customers. Regulators in each state will review the IRP in the weeks ahead.
Avista’s Steve Harper, natural gas supply director, said he expects customers to continue to benefit from low gas prices and the absence of the need for the utility to add new long-term resources. Avista’s latest gas outlook — the first since December 2009 — characterized major changes in recent years as twofold: flatter demand and lower gas prices due to increased domestic production.
Access to untapped shale gas formations throughout North America “could provide long-term availability to low-priced natural gas,” according to Avista’s plan.
“With no immediate resource needs, our ‘action plan’ guides us to continue to watch the changing landscape of natural gas supply, including Canadian supply availability and interprovincial demand, exporting liquefied natural gas, regional and national pipeline/storage infrastructure activity, plans for addition al gas-fired generation, legislation regarding hydraulic fracturing and other environmental concerns,” the report said.
Long-term gas demand forecasts have declined and shorter-term price declines have been even greater, according to Avista’s plan. It called flat demand “a key risk” that will have to be carefully monitored.
Avista said it has filed with regulators in Idaho and Washington to suspend demand-side management (DSM) efforts and it is considering doing the same in Oregon. “The avoided costs from the 2012 IRP are considerably lower due to the drop in natural gas prices,” Avista’s plan said. “Current avoided costs have rendered gas DSM programs cost-ineffective.
“Should prices rise, Avista will be proactive in reinstating cost-effective DSM programs.”
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