Natural Gas prices going up, WHY?

[Dylanl]

Just reading an article from the paper. Anyone know why here in the East we are supposed to see an increase of 37% in natural gas prices? I feel sorry for the mid west there it is supposed to be a jump at an alarming rate of 52%?

Is this another case of price gouging?

Anyone have a reasonable explaination?

[dragonfyr]

Easy! Demand is exceeding the supply!

An with each disruption in the ability to process and distribute fuel comes disruption in the marketplace. It is simply classical economics that we have chosen to ignore for far too long.

http://www.reason.org/commentaries/moore_20050901.shtml

And plenty of additional information is available!

And quite frankly, I don't care who is in office! It is superfluous to the situtation that we ALL have created for many decades! And for every gripe you can attribute to someone, I can attribute 10 to someone else! So please don't even waste our time going there!

But just to express an alternative to the 'everyone is a victim' concept...
How many have bought or built super insulated homes? How many have moved to reasonable integrated low impact complimentary technologies that integrate simple solar concepts, geo-thermal heat pumps (not the ordinary nonsense versions!), radiant energy, even high quality alternative systems such as a tulikivi stove/fireplace for clean alternative heat. And the list of appropriate technologies appropriate to each person's location, climate and other environmental and economic factors is incredibly long.

And my ultimate favorite in areas of streams and springs and hills, small scale hydro with a 6 to a monster 12 inch pelton or turgo impulse turbine generator that you can install in your back yard!

Nothing radical! Simple complimentary techniques! Heck, how many have a simple garden!? Too few is my guess!

It amazes me how functionally illiterate we are with basic skills! But I will bet that far too many of those who don't have these basic skills are conversant or possess elaborate gaming or home theater systems! And how many make simple choices that all add up like choosing class A amps or tubes over solid state or all the miniscule little choices that mirror own entire set of life choices! We each have choices and we make them! Even if we choose to ignore most ot the effects until they simply become too painful!

It's time that folks start thinking in terms of how THEY can assume some responsibility and make their own difference instead of waiting for whoever this someone else is to do it for them! You are free to make choices! So make good ones!

And it is NOT the governments job to insure your comfort in the event of a natural or unnatural disaster! And if anyone is waiting for the government to assume responsibility for the first time since its inception...well, I will simply be polite and say I hope you enjoy your wait! But save all of the wonderful stories![]

Ole Walt Kelly put it best! "We have met the enemy and he is us!"
But I guess that's a bit passe in this day of enlightened self-interest!

http://www.energybulletin.net/2709.html

http://www.gravmag.com/oil.html#highcost

http://www.gravmag.com/oil.html

[colterphoto1]

Good thing everyone has been building 4000-8000 drywall barns and took the time to make them energy efficient at the same time.

[garymd]

Easy! Demand is exceeding the supply!

An with each disruption in the ability to process and distribute fuel comes disruption in the marketplace. It is simply classical economics that we have chosen to ignore for far too long.

http://www.reason.org/commentaries/moore_20050901.shtml

And plenty of additional information is available!

And quite frankly, I don't care who is in office! It is superfluous to the situtation that we ALL have created for many decades! And for every gripe you can attribute to someone, I can attribute 10 to someone else! So please don't even waste our time going there!

But just to express an alternative to the 'everyone is a victim' concept...

How many have bought or built super insulated homes? How many have moved to reasonable integrated low impact complimentary technologies that integrate simple solar concepts, geo-thermal heat pumps (not the ordinary nonsense versions!), radiant energy, even high quality alternative systems such as a tulikivi stove/fireplace for clean alternative heat. And the list of appropriate technologies appropriate to each person's location, climate and other environmental and economic factors is incredibly long.

And my ultimate favorite in areas of streams and springs and hills, small scale hydro with a 6 to a monster 12 inch pelton or turgo impulse turbine generator that you can install in your back yard!

Nothing radical! Simple complimentary techniques! Heck, how many have a simple garden!? Too few is my guess!

It amazes me how functionally illiterate we are with basic skills! But I will bet that far too many of those who don't have these basic skills are conversant or possess elaborate gaming or home theater systems! And how many make simple choices that all add up like choosing class A amps or tubes over solid state or all the miniscule little choices that mirror own entire set of life choices! We each have choices and we make them! Even if we choose to ignore most ot the effects until they simply become too painful!

It's time that folks start thinking in terms of how THEY can assume some responsibility and make their own difference instead of waiting for whoever this someone else is to do it for them! You are free to make choices! So make good ones!

And it is NOT the governments job to insure your comfort in the event of a natural or unnatural disaster! And if anyone is waiting for the government to assume responsibility for the first time since its inception...well, I will simply be polite and say I hope you enjoy your wait! But save all of the wonderful stories![]

Ole Walt Kelly put it best! "We have met the enemy and he is us!"

But I guess that's a bit passe in this day of enlightened self-interest!

http://www.energybulletin.net/2709.html

http://www.gravmag.com/oil.html#highcost

http://www.gravmag.com/oil.html

What was the question again?

[3dzapper]

WOW!! 734 acres. Now that is one BIG barn!!!!!!!!!!!!!!!![]

Rick

[r.cherry]

please do not include me in your "ALL". some of us out here try to

recycle everything, drive less, conserve more, and whine less. kindly

direct your speach towards those that choose to go blindly about their

way, caring not what or how much they waste and toss away as if there

were of no consequence.

[dragonfyr]

please do not include me in your "ALL". some of us out here try to recycle everything, drive less, conserve more, and whine less. kindly direct your speach towards those that choose to go blindly about their way, caring not what or how much they waste and toss away as if there were of no consequence.

Sorry!

While I am not attempting to demean anyone's efforts, the fact is that our reality is the sum result of what we all have done!...Be it demonic or angelic!

And the net result affects us all!

[Malcolm]

I can think of a few reasons for the rise in the price of natural

gas. First, Katrina took a number of oil/gas platforms and

distribution networks in the Gulf of Mexico off-line for a while.

This should all work itself out it a few months. Then there is

the increase in the price of products like diesel, fuel oil, etc.

Some users can switch from one fuel to another. They will switch

to natural gas when the operationg cost is less than the cost of

operating on diesel or fuel oil. This pushes the relative cost of

natural gas closer to the alternatives. Then there is the whole

world-wide petroleum market. Market prices often have little to

do with actual supply and demand. People are driven by

fear. The situation in the Middle East, Africa, Venezuela and the

like doesn't inspire confidence. Then there is OPEC who can at a

whim change output affecting demand for alternative fuels.

I know this winter I'll switch to electric space heating if natural gas

goes up as much as predicted. We have a real good electric

utility with low, stable rates. They own a lot of the generating

capacity they use, and a lot of it is hydro, geothermal and

solar. They made money selling to other California utilities

during the California energy crisis.

My big gripe about energy is that the United States has so much

untapped energy in the form of clean (relatively, for coal) coal, oil

shale, untapped reserves off the Pacific coast, Alaska and elsewhere,

and thousands and thousands of low output wells (maybe just a few

barrels a day to hundreds of barrels a day) that were abandoned because

of the cost of complying with well-intentioned but sometimes ridiculous

environmental laws. Oh well, if a real crunch comes, we

have enough oil for quite a while. We'll just have to develop it.

[hooting_monkey]

Well if you are gonna while about people that arem't building energy

efficient homes, expect some criticism to your remarks. Most

efficeintcy enhancements come at a steep price, which homebuilders

either can't, or find it difficult to pay for. So maybe you should loan

them money to do so and quit whining. Also, I wanna know what kind of

car everybody drives. I drive a '95 Saturn SC1 that gets 36mpg hwy and

28 city, so I'm doing my part.

[Juba310]

'04 Saturn Ion1 26/32 epa estimated. Since its manual I can do better than the estimation though...

Go saturn =)

[dragonfyr]

Well if you are gonna while about people that arem't building energy efficient homes, expect some criticism to your remarks. Most efficeintcy enhancements come at a steep price, which homebuilders either can't, or find it difficult to pay for. So maybe you should loan them money to do so and quit whining. Also, I wanna know what kind of car everybody drives. I drive a '95 Saturn SC1 that gets 36mpg hwy and 28 city, so I'm doing my part.

Nonsense!

Intelligent design and using appropriate technology need not be any more expensive, and in the long run over its life cycle can be much cheaper! And I am speaking of much more then what brand car you drive, and I don't care if you recycle or not! Especially as most recycle programs are not independently sustainable!

You miss the point entirely as you run to point fingers and try to differentiate yourself!

Funny as how I was using the terms such as 'you' in an editorial sense that we are all responsible and that EVERYONE is included! EVERYONE!

I find it humorous that so many are whining (to use YOUR word!) about our self-imposed predicament!! I am not out crying about gas prices and looking for someone to blame! I am merely acknowledging that we, as a population, have chosen our poison! We have chosen technologies based upon the dependence on fossil fuels, despite already having been through a rude awakening in the mid 1970's! People have continued to use and buy the same technologies, after having been made well aware of the consequences! We have decided that we will remain dependent upon foreign sources in an increasingly volatile global marketplace! And the fact that your whatever car gets X miles to the gallon doesn't mean squat in the total scheme of things! It still is dependent upon a finite fuel for which we are dependent upon foreign sources! And I am assuming that most people buy the kind of vehicle that suits their purposes, regardless of whether some do not! And they pay for the privilege! This situation that so many want to debate is akin to the Microsoft suit where so many who 'voted' for the technology with their purchases then ran to the government to protect them from their own market vote! How ludicrous...

I find it rather amusing that so many who are so dependent upon technology that is dependent upon fossil fuels (whether directly or indirectly, as for instance so many electrical generation plants have switched to natural gas to power the generators for environmental reasons!) now find it appropriate to complain and point fingers at the 'others'!

Pointing fingers is a bit absurd except to oppose those who have refused to participate in a real dialog of real market options, especially as you have much more power to make real choices then most want to acknowledge! And the excuse as above that most cannot afford the choices is ludicrous. And if you believe this, then you are simply unaware (ignore-ant) of that to which I refer.

That is why I said ALL of us have done this! We have all made choices! And we have all had the opportunity to make choices along the way that have either helped minimize our own individual dependence on others or we have not!

But I get a laugh out of those who want to point fingers and say you did this or you did that or I am not to blame! Or those who simply absolve themselves and blame the amorphous abstraction called the government. We are all to blame to various degrees! And we are now reaping the rewards of our failure to build additional capacity in the areas of fuel processing and refining, thanks in large measure to the NIMBY and oh so righteous obstructionist environmental groups who proposed artificially inflating gas prices to the current prices as in Gore's Earth in the Lurch! So they should be rejoicing! Many of these same groups have consistently opposed all proposals for the building of new refineries or for developing new domestic sources for fuels! And I am NOT proposing irresponsible development! But this obstinent refusal to develop current technologically feasible alternatives to the present system is a real problem. And we as a population are ultimately responsible for this!

And I find it humorous that so many who are so concerned with so many of the challenges do SO little to make very reasonable basic lifestyle changes to minimize the impact of the dependence upon themselves, despite society's continued overall dependence!

Personally I am not shocked at all. But there are real practical choices that can be made. And I am not talking about choices IMPOSED from the top! Nor am I proposing wacko draconian measures like Gore and many of the extremist environmental wackos. There is a middle ground based upon individual responsibility and making good and reasonable informed decisions.

So for all of you who want to come out of the woodwork and point fingers, go tell someone who cares! There are very practical reasons that we are experiencing the pricing structure we are. They are basic economic free market realities. And it is not due to wacko conspiracies nor to who is currently in office as so many who perennially look for scapegoats are want to blame! There are reasonable ways to encourage responsible domestic development of existing technologies as well as encouraging the development of economically feasible and competitive emerging and alternative technologies. And we each have a role to play in supporting this.

And perhaps some of these folks who are so shocked at gas prices will take a few minutes to look into and learn about a few of the legitimate global market realities instead of running for some emotional/political fix blaming one group or the other! And just maybe folks will start looking at the larger context in which we live and become more aware and informed regarding the choices we make and not simply naively oppose the building of ALL refineries and the development of ALL domestic sources, as well as the development of domestic sources of alternative and economically feasible sustainable bio-fuels, etc.! The long term answer is an integrated approach that involves both the macro world of national and international policies as well as the micro world of individual lifestyles where we choose to become smarter consumers as well as shifting from the consumer role into a role of small scale producer in many aspects of our lives.

And I 'm sorry for those who feel threatened by this concept, but the crying that you have done everything you can - thus implying that it is everyone else who is to blame is silly! We are ALL responsible for the current situation and ALL responsible for making any changes!

It would just be a nice change to hear more informed discussion that both educates and proposes reasonable and feasible options for individual and large scale strategies, without the histrionics of the blame game and the all too common political scare tactics.

[Parrot]

This is all well and good, Dragonfyr, but isn't it easier just to blame the big, bad oil companies?

[Dylanl]

I still find it hard to believe that some companies are not taking advantage of the current situation.

[colterphoto1]

My comment regarding home building is that the trend seems to be BIG BIG BIG and NICE NICE NICE without much thought toward energy efficiency at all. A German carpenter friend of mine said modern USA homes would be fit to be summer cottages in Europe due to the shoddy build. I see homes with barely any soffit overhang, standard heating systems, and no forethought toward location on the site (ie angle to the sun). Tract housing is an absolute joke. I wonder if some of them will outlast their 30 year mortgage. If I were to build a new home today, my dollars would go less toward massive square footage, and more toward comfort and enegry enhancing measures like following the sun for passive gain, landscaping for cooling shade, state of art heating systems, etc.

If anyone's interested my 1955 home has 4" stone walls all around, efficient, comfortable hot water boiler heat from new $5000 unit, R40 in ceiling, and barely uses any air conditioning due to large lot, mature trees and attic fan. New windows for more efficiency are coming next summer. I just moved from a family farm to the city to consolidate my business and home, so I have a commute of 0 miles. I purchased an older home for the quality of build, radient heat, and location in town vs the suburbs with long drive times.

My Honda Accords have been getting 30+ mpg since 1976. I recycle whenever possible.

I garden, use minimal pesticides and lawn care chemistry, and wear natural fibre clothing.

Doing my part? I think so. What's YOUR energy quotient?

Michael

[BEC]

Back to the original topic by the starter of this thread, I think natural gas is particularly prone to having its distribution system compromised.

Natural gas is a really special case in the energy mix. There is lots of it, but no practical (cheap) way to store it up for future demand. The stuff is either in the well or traveling to its final destination in a pipe to be used. My knowledge on natural gas production is somewhat dated and things may have changed some since the late 70s when I worked briefly for ESSO Libya at a plant that produced liquified natural gas. Unless they have improved that process (turning the gas to a liquid) since I was involved in it, was only about 10 percent efficient. That is, it used up 90 percent of the gas getting it delivered to europe where it was needed. There was no way to store it even in the ground in Libya. It was produced at such a high pressure that the wells could not be shut off. The pressure would push the well casing out of the ground. Without a pipeline from the production point, LNG was the only way to go and 10 percent is better than nothing. Any time the plant was down, the gas was flared (burned) at the top of towers.

Delivery of the LNG to europe from Libya was in insulated tanks on ships at atmospheric pressure. It was cooled by boiling off some of the gas continuously which leaves a visible cloud trailing the ship.

The supply of natural gas may be truly almost without limit. Probably still as much or more of it may be being burned at wells as is being used for any purpose. I hope that is not the case now, but when I was involved, seemed that the problems of storage and delivery were almost without solution.

Since I have said my information is a bit dated, feel free to update me on this subject.

Bob

[dragonfyr]

Bob, your understanding of the relative abundance of natural gas as a commodity is consistent with my understanding as well.

I have always maintained the rather simplistic concept that if the petroleum distributors were required to provide a supply at each gas station, that the necessary impetus might be created to develop the distribution network sufficient to make the easy conversion from gas to LNG in vehicles and to also benefit the environment. But I realize that you still have to deal with market infrastructure realities...and allot has to happen in between the 'why don't they' and the 'they should' and reality!! But maybe some of that money being spent on cleanup could be redirected towards a proactive policy rather then a reactive response - assuming that the supplies could actually be accessed and processed!

Here is an excerpt from 1.5 years ago forecasting the shortage in supply of LNG do in large part to the exact same problems causing shortages of other petroleum products, with the exception for natural gas being that it is not a finite supply like other petro chemicals. And we are simply dealing with increased disruptive forces on an already precarious market structure.

And consistent with the state of the infrastructure of gasoline, the failure to develop a responsible infrastructure is what is responsible for the restricted availability of LNG!! Personally I find it rather fascinating that a fuel with such limited negative environmental consequences has been opposed as vigorously as other fossil fuels!!

What this tells me is that it is not the fundamental environmental quality issues that are of major concern! But rather that there are other socio-economic concerns that are of more fundamental importance then simple minimal environmental impact! And this has been the primary agenda of the hard core environmental groups from the beginning, where the environment has simply been used as a lever to control and influence industry and financial policy.

Funny, Greenspan was warning us specifically about exactly this 2 years ago! And efforts to alleviate, at least in part, the limited supply have been opposed consistently by a particular group whose silence is deafening with regards to this subject! Where are the left and the eco-wacko comments on this issue???????????????????

More of the following is available at - also check out the various links which provide much more information regarding all aspects of the subject: http://www.enviroliteracy.org/subcategory.php/234.html

"The U.S. is facing a shortage of natural gas supplies, which may lead to significantly higher gas prices during the upcoming winter months when demand is high. Alan Greenspan, chairman of the United States Federal Reserve Board, warned Congress in June 2003 that increased prices for natural gas, which accounts for twenty two percent of American energy consumption, could have a substantial effect on the U.S. economy.

Higher power prices will effect consumers in several ways. More than 55 percent of U.S. homes use natural gas for heating; many homeowners have already seen their utility bills soar over the last six months. And because natural gas is the cleanest hydrogen carbon fuel, many utilities and business now generate electricity from natural gas, which means that consumers will pay higher prices not only for electricity but also for consumer goods because of the higher costs of manufacturing them.

There are large volumes of natural gas in the US classified either as proven reserves or considered as potentially recoverable resources.

Natural gas reserves often exist alongside deposits of other hydrocarbons, such as petroleum and coal that have historically been more valuable and easier to extract. However, a considerable portion of these reserves or potential resources are currently inaccessible because they are on protected lands or because of the costs of transporting the gas. A sizable percentageup to 40 percentof U.S. natural gas resources lies beneath protected federal lands, and drilling in these lands is limited by strict environmental controls. And natural gas supply is greatly affected by difficulties in transporting it. Unlike petroleum, which can be shipped long distances in tankers, natural gas is most economically shipped in pipelines, in a pressurized gaseous state. Natural gas can be shipped as a liquid in tankers, but liquefying natural gas (LNG) requires that it be cooled to around -162°C (-260°F), which is expensive. For petroleum producers in the Middle East, the cost of liquefying (for shipment abroad) the natural gas that comes up from oil wells is simply too great. Gas from these wells is generally discarded burned off in huge gas flares rather than collected. Because of the difficulties in transporting natural gas, most natural gas supplies (85 percent) comes from the United States.

Environmental concerns have deterred construction of additional natural gas pipelines or the LNG terminals required to ship the fuel by tankers. Much of the U.S. natural gas supply is on or near the north slope of Alaska; however, the fate of a proposed pipeline running along one of two routes through Western Canada to the lower 48 states remains uncertain. Construction costs for the pipeline are estimated at $10 to 20 billion, depending on the design."

[Duke Spinner]

no, BEC ...

there is a HUGE underground storage facility 30 miles from me ...

they store i can't remember how many MMcf in liquid form in rock .....

[Duke Spinner]

'an, DraGon ......

solar has no payback in the Northeast

do you know the capital cost and maint on Geothermal ...???

it's insane..........check out the installed cost on a "Waterfurnace" system

starting at $ 20- 25 k......these "alternate" technologies ..

look good on paper

look how quick the Solar industry colapsed without tax credits ...

[dragonfyr]

I am NOT proposing the support of non-economically feasible alternatives!!!!!!!!!!!!!!

But integrated passive solar systems are affordable and do work! And they are worthwhile! And I am not pushing solar! It is but one of many complimentary technologies that can be used where appropriate!

And geothermal heat pumps which simply have their coils buried have a high rate of return especially in the northern climates where air transfer units are of limited use. And there is essentially NO maintenence!

Nor am I advocating a one size or one technology takes all approach! I am advocating exactly the opposite! And certainly not some 'let's go back to the age before electricity' craziness!

Duke, I am NOT proposing the adoption of the pie in the sky alternatives that are merely conceptual wish lists! Instead there are many real practical options!!! Many appropriate and complimentary technologies that exist NOW! And an example of such are simple passive techniques, or simply design elements that take advantage of intelligent integration into the surroundings that when used in an integrated manner where appropriate yield substantial dividends over the long run!

And I am glad you have a storage facility next to you, unfortunately the rest of the country doesn't exactly live next to you, except figuratively! The point is, the other folks do not have such facilities convenient to their market!

[BEC]

Duke,

Are you sure that is stored as liquid? I thought all those were compressed gas. I don't think we can store it as a liquid because of the pressure and refrigeration required. Like I said, my information may be somewhat out of date.

Bob