For more than a decade, cold winter temperatures in parts of New York and New England resulted in price spikes for power producers and manufacturing companies lacking firm natural gas supply contracts. Learn more at
http://bv.com/reports
TRANSCRIPT
Denny Yeung | Principal Consultant, Black & Veatch:
Convergence is an issue today due to the rising in gas demand for power generation. The current infrastructure today is primarily used prior design to serve local distribution companies that have residential and commercial heating loads.
As the demand for gas-fired generation increases in the wintertime, there are certain constraints on the system where there isn’t enough capacity to serve these growing generation needs.
We see convergence issues have the largest impact in New England. This past winter, due to extreme cold weather, we’ve seen gas prices skyrocket to above seventy dollars per MMBtu; while in other markets in Louisiana they are closer to four to five dollars.
In response to the higher prices, New England electric utilities have proposed 30 to 40 percent price increases over the next year to help recover these costs.
Overall we see a need for new gas pipeline infrastructure across North America to help serve growing power generation needs.
In most parts of the country we see lots of these convergence issues, whether they be pipeline constraints or dealing with the merging of gas electric markets, will become issues that will have to resolve on a regional level.
Convergence is going to be a very difficult issue to resolve between the gas and electric industry. There are ways where we can work together but there are also many obstacles still to come.
Convergence of Natural Gas and Power Generation black mirror season 5 | |
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| Science & Technology | Upload TimePublished on 28 Oct 2014 |
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