Additional natural gas demand nationwide from new power generation capacity could equal up to 4 Bcf/d, according to a new report from Energy Security Analysis Inc. (ESAI). Using long-term operating assumptions, the analysts have concluded that maximum natural gas demand from new power units may actually exceed last year’s gas use at power plants in Florida and nearly equal it in the Southwest — setting up the potential for significant gas consumption this summer.

In its latest “North American Natural Gas Stockwatch,” ESAI compared actual daily average gas consumption for power generation last July and August with the theoretical maximum incremental demand from the North American Electric Reliability Council (NERC), which estimated that 55,000 MW of new gas-fired capacity would be added nationally between October 2001 and September 2002.

“Using maximum operating assumptions likely to reflect long-term operating parameters — such as peakers run 15% of the time and combined-cycle units run 50% and cogeneration and steam units run 60% of the time — the nationwide maximum additional gas demand from new capacity would be just under 4 Bcf/d,” said Mary Menino, a senior analyst with the Washington, DC consultant.

ESAI analysts believe the greatest potential increases in gas demand from new capacity are expected in Texas, the Southeast and the Northeast, including New England. New gas-driven power capacity will also play a role in the Middle Atlantic, California and the Southwest, including New Mexico, Arizona and southern Nevada, analysts said.

“New gas-fired generating capacity added since last summer is expected to make up a significant portion of NERC’s projected summer’s generating reserves,” said Menino. According to ESAI, new capacity will be “critical” in Florida, where gas-fired capacity is replacing oil-fired capacity, and will make up more than 20% of the reserve margin in the East North Central region (ECAR), East South Central region (SERC), Energy Reliability Council of Texas (ERCOT), Illinois and part of Wisconsin (MAIN) and the Northeast (NPCC).

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