Although the power industry has been rocked by sharp pricerun-ups this summer, average real electricity prices are projectedto drop by more than 25% by 2015 largely due to improvedefficiencies and cost reductions brought about by electricityrestructuring, the Gas Research Institute (GRI) said in a new studyissued yesterday.
The results of the study, which is titled Electric GenerationSector Summary, contradict a recent American Gas Associationreport, which concluded that the real electricity prices would fallby about 14% to 5.9 cents per kWh by 2015 – with most of thedecline coming in the industrial customer sector.
Given its predictions, the institute said the generally downwardtrend predicted for electricity prices could have severalimplications for the natural gas industry as it attempts to widenits market share, including:
* To remain competitive, gas will have to offer low-cost gasservice and more efficient, inexpensive end-use technologies;
* It should exploit market opportunities where higher peak-timeelectricity prices could give the advantage to gas cooling,peak-shaving generating technologies and distributed generationapplications;
* Pipeline and storage capacity will have to be expanded to meetthe reliability and low-cost needs of electric generators; and
* Gas will need to capitalize on the environmentally benignfeatures of gas-fueled power generation and develop even moreefficient emission-reduction technologies to capture the projectedlarger market share for new power generation. The GRI studybelieves the power industry will look to gas as a “low-cost hedgeor bridge strategy” to avoid large capital investments inpollution-control equipment after 2000.
The study (GRI-98/0009) can be ordered directly from the GRIDocument Fulfillment Center, 1510 Hubbard Dr., Batavia, IL 60510,or by fax at (630) 406-5995. It costs $20 for GRI members ($25non-members) plus shipping and handling. Contact Val Megginson forinformation (703) 526-7832.
©Copyright 1998 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press,Inc.
© 2021 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |