The growing variability in the composition of natural gas delivered to American consumers is creating a number of new operational, reliability and safety concerns, according to a presentation made Wednesday at FERC’s regular meeting by a broad coalition of industry trade associations, research organizations and other stakeholders.

Changes in gas quality and composition have serious implications for all sectors of the industry, including pipelines, utilities, end users, power plants and others. High gas prices have made it more economic for producers to keep liquids in the natural gas stream rather than pay for processing. In the meantime, domestic supply concerns have led to a rapid increase in the number of planned LNG import terminals, which means gas from all over the world will be entering the United States in growing quantities and dramatically changing gas flow patterns on the pipeline grid.

These two factors combined are leading to significant variability in the composition of the natural gas entering the pipeline grid and being delivered to end users all over the nation.

“The quality of the natural gas has not been an issue in the United States,” noted Evan Gaddis, president of the Gas Appliance Manufacturing Association. “There is a lot of experience in Europe, Japan and through Asia, where they have used liquefied natural gas for quite sometime. Historically it has not been an issue for the manufacturer or the consumers here because historically we have been able to deal with the quality [of gas] that we work with.

“Now with the introduction of foreign gas that is coming in, that’s changing and we’ll look at the effects on the life cycles of our products, the increase in carbon monoxide [and] nitrogen dioxide. We are looking at a decrease in shelf life, we believe, and also a decrease in efficiency.”

Industry representatives told FERC that regasified LNG has led to greater emissions at power plants in Korea. It also has the potential for causing reliability concerns due to operational problems, such as vibrations due to gas quality changes. General Electric informed the coalition that it can make a power turbine that runs on any fuel but its machines can’t handle changes in fuel quality without adjustments being made.

“There is a wide variety of combustion related and noncombustion related gas composition requirements that must be served, ranging from residential and commercial end users on one hand to…processing sensitive industrial users,” said Donald Santa, president of the Interstate Natural Gas Association of America and spokesman for the coalition. “In some cases, the tolerances for such compositional variations have not been studied and publicly available information has not yet been developed.”

One of the important issues is that many gas customers, particularly residential gas users, don’t have controls that can be used if a potentially harmful gas composition makes its way into their home. Larger end users also may be affected by rapid changes in the compositional variation of gas. Such changes could impact reliability, safety and equipment integrity, Santa noted.

Judging from the large number of associations and organizations represented at the Commission on Wednesday, the issue of gas interchangeability and gas composition already is having a sweeping impact on the gas industry. The Gas Interchangeability Task Group involved 62 individual members, representing 14 gas suppliers, 31 distribution companies and end users, four gas transmission companies and seven consulting organizations.

A group of six industry trade associations, three research organizations and at least 10 companies played a role in drafting a white paper on “hydrocarbon liquid dropout” issues that was presented to FERC Wednesday.

The coalition of organizations also submitted some consensus items on gas “interchangeability,” but they said very little research on these issues has been done and a significant amount of work must be completed before the coalition will be prepared to provide FERC with a final set of technical and policy recommendations.

Santa said the task group intends to develop technical guidance that will “facilitate adopting interchangeability specifications that can balance the potentially conflicting goals of addressing the needs of most consumers, posing the fewest constraints on gas supplies and preserving the safety, reliability or integrity of end users and equipment.”

The task group intends to develop a white paper with technical recommendations to FERC by the end of October. Santa said the group also is discussing government research and development funding with the Department of Energy.

He said that although the group intends to focus on technical recommendations to FERC regarding gas interchangeability issues, it will leave most of the policy work for the Commission to tackle.

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