If winter is bitter, brace for a natural-gas crunch
From Maine to Florida, from Virginia to Missouri, as much as half the United States confronts the possibility that harshly cold weather will lead to restrictions of natural-gas supplies. In some places - areas heavily dependent on natural gas to produce electricity - the prospect of "rolling blackouts," or controlled power outages, is much higher than in previous winters.Skip to next paragraph
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Any natural-gas cutoffs would primarily affect electric-power plants and factories fueled by gas, not homes, and be most likely in the Northeast.
If cold deepens for prolonged periods, the likelihood of interrupted natural-gas supplies rises to 30 percent in the Northeast and to 10 percent as far south as Florida and as far west as Missouri, according to a recent report by the Interstate Natural Gas Association of America (INGAA), a trade association representing gas pipeline companies. In a "worst-case" scenario, chances of interrupted gas rise to 40 percent for the Northeast and 25 percent across the eastern seaboard.
Though power-industry officials in New England are the most concerned, noting the region's lack of fuel diversity and propensity for intense cold, the impact could be far broader. If winter temperatures plummet for long, natural-gas supplies could be quickly depleted, leading to a power crunch in some regions and soaring prices across a wider area, experts say.
"By no stretch of the imagination is this only going to impact New England," says Richard Levitan, an energy expert who has analyzed the impact on the utility industry of this fall's natural-gas shortfall after the Gulf hurricanes. "The Southeast, Pennsylvania, New Jersey, Maryland, and New York, they're all going to feel this."
Even so, gas cutoffs would not automatically mean power outages to residential and commercial consumers. Regions with diversified fuel sources, such as the Midwest or Southern states that rely more on nuclear or coal for electricity, are less likely to see power outages at all. In all regions, residential customers who heat homes with natural gas are unlikely to have their supply interrupted, because gas utilities typically have "firm contracts" with distributors.
Overall, 23 percent of America's electricity-generating capacity is fueled by natural gas. In New England, however, fully 40 percent of electricity is drawn from natural-gas-fired power plants, up from just 17 percent in 1999. At least 22 natural-gas-fired plants, with a collective 10,000 megawatts of generating capacity, have been built in the region since the late 1990s - a shift that, at the time, seemed good for business and for the environment (because natural gas burns cleaner than alternatives).
That buildup has left New England's energy mix skewed toward natural gas, which now costs five times what it did three years ago and which is in short supply this winter. This is where the risk is highest for rolling blackouts - shutting off power for 20 to 30 minutes at a time - in sections of the region's grid.
"If gas supplies are disrupted and seasonal oil storage [backup fuel for generators] is drawn down, then we get into a problem where we're now short of electrical generating capacity," says James Coyne, an energy expert at Lexecon, a Boston economic consulting firm.