
Gas Dependency Looming?
Prices have dropped to what virtually everyone says are unsustainable lows since advanced technology, using horizontal drilling and hydraulic fracturing, opened up vast new resources in gas shales around the country. In less than 10 years, shales have gone from virtually nothing to about quarter of US output in 2010, according to the US Energy Information Administration.
Cal Cooper of Apache Corp. told the NARUC conference that it is "very difficult" to see gas going "above $5 anytime soon." Shale gas' sheer abundance means worry about price spikes is needless, he said.
Learning From History
piking gas prices, most recently in 2008 when gas briefly neared $14, and many utility executives remain leery of too much dependence on natural gas suppliers.
John Bear, President and CEO of the Midwest Independent System Operator (Midwest ISO), said with the short EPA compliance schedule, generators will all be turning to natural gas in the same few years, which could mean price volatility. Some analysts have already predicted price spikes in 2015-16.