With predictions for a 10-year low in water levels, Pacific Northwest energy planners are looking at an upswing in natural gas use for electric generation in the opening months of the summer. The Northwest River Forecast Center’s latest outlook released earlier in April underscored this prospect.

Separately, the Northwest Gas Association (NWGA) in a white paper said aside from water levels, climate change and consumer demand “will likely increase the regional reliance on natural gas.” NWGA’s issue paper on gas infrastructure in the region said that as a fuel gas already is a “necessity,” accounting for 54% of the Northwest’s nontransportation energy.

“Given the three to five years new infrastructure projects can take to permit and build, we must prepare for the future now,” said the NWGA paper. Both a series of new interstate pipeline proposals and proposed liquefied natural gas (LNG) import terminal/pipeline projects are cited in the report as viable options without specifying one over the other.

For the immediate situation related to water levels and gas, Stephen King, a hydrologist at the river forecast center, called 2010 likely to be “dry, but not bone dry.” September Columbia River flows now are projected to be 65% of normal at The Dalles Dam on the Washington-Oregon state border.

Noting that while natural gas fundamentals overall may be weak this year, the Northwest could be a “pocket of prosperity” for natural gas, according to analysts at energy investment bank Simmons & Company International. They pointed to drivers coming from both the prospect for more coal-to-gas switching in power generation and the continuing low water levels.

Simmons thinks the combination could boost gas use in the region by as much as 1 Bcf/d.

The market is working, according to the NWGA report, citing a mix of new pipeline, storage and LNG import proposals as the proof. “Each of these multi-million-dollar investments would not be under consideration if investors did not believe the projects were viable,” NWGA’s report said.

“The goal is to ensure [that] our regional system of natural gas infrastructure is nimble enough to allow greater access not only to our tried-and-true supply resources [Western Canada and the U.S. Rockies] but also to emerging new sources. Such flexibility allows the market to optimize resources, take advantage of lowest-cost supply at any given time, and ultimately benefit consumers with more stable prices.”

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