FERC is still studying strategies to coordinate the natural gas and electricity markets, but one idea floated at a recent technical conference — splitting East and West gas days — isn’t getting great reviews from some gas industry officials.
It’s an interesting idea, said Mark Stultz, BP Energy Co. senior vice president for regulatory policy and communications, but one that he said creates a long list of potential problems if implemented.
“I think the questions raised around that are, would that really solve the dilemma that you’re facing with the sub-regions that would still exist on the power side? Even if you divided the U.S. in half and had a gas day that started at a different time on the East half versus the West half, you still wouldn’t necessarily be synchronized with those regional power markets,” Stultz said at the LDC Gas Forum in Atlanta last week.
“The other concern would be taking something that for much of the country and for a long time has worked quite well, quite efficiently, and suggesting that we have to break that up to accommodate a market that is fractured and in constant flux…I think that there is across the industry some reluctance to take something that isn’t broke and try to fix it.”
The suggestion of an East-West gas day split was made during a technical conference, which was focused on information sharing and communications issues between natural gas and electric industry companies, hosted by Federal Energy Regulatory Commission (FERC) staff Feb. 13.
It was the first of two conferences that FERC directed staff in mid-November (see NGI, Nov. 19, 2012a) to convene to address common issues that were raised in nearly every region in August (see NGI, Sept. 3, 2012; Aug. 27, 2012). The second conference, which will focus on whether and how natural gas and electric industry schedules can be harmonized to achieve the most efficient systems for both industries, is scheduled to be held April 25.
In January, FERC approved ISO New England’s (ISO-NE) proposal to share real-time information on natural gas-fired power generation resources with interstate gas pipeline operators in order to head off concerns about unreliable generation dispatch (see NGI, Jan. 28). The grid operator requested real time data sharing with pipelines last year, warning of “significant reliability concerns regarding generator performance that may be exacerbated during the upcoming winter” (see NGI, Nov. 19, 2012b). Prompting the request was a history of generation resources falling short of what was requested of them in times of need, ISO-NE said.
Power customers and regulators outside of New England have said that there are opportunities for tweaking and some efficiencies, “but there really are not to the same extent the reliability concerns that we are facing in New England,” Stultz said. “We as an industry…believe we can step up and answer the call of the power community when it comes to additional natural gas.”
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