Wednesday, August 29, 2012

Natural Gas: Mayor Bloomberg Says New York City Must Use More

Prices and supply are at the point that building out the distribution infrastructure, including the "last mile", makes sense on the East coast.
From Platt's:

Bloomberg doubles down on natural gas for New York City  Washington
Continuing his campaign to back natural gas as the fuel of choice for his city, New York Mayor Michael Bloomberg released a study late Monday that showed New York needs natural gas to make complete its conversion away from heavy heating oil use in the city.

The study by ICF International notes that by 2030 New York City's two local distribution companies -- ConEd and National Grid -- will have to reserve more capacity on interstate pipelines as well as make full use of 1.13 Bcf/d worth of new pipe coming to the city-gates to keep the city supplied.

In April 2011, the city passed a set of regulations that phases out the use of No. 4 and No. 6 heating oils in building boilers by 2030, to be replaced by biofuels, No.2 fuel oil and natural gas. ICF estimates the full conversion will increase the average daily gas send-out by the two LDCs by 16%, or 160,000 Mcf/d on a normal day, jumping 30% to 560,000 Mcf/d by 2030.

In 2009, New York City burned 1.3 Bcf/d on an average day, climbing to 2.5 Bcf/d on peak days in summer and winter, ICF said.

New York City's difficulty, even with the completion of Houston-based Spectra Energy's 800,000 Mcf/d New Jersey-New York pipeline from Jersey City to Manhattan, and two Williams pipeline improvements accounting for 350,000 Mcf/d of natural gas, is that demand for gas will increase 1.1%/year through 2030 while available supply capacity will increase less than 1%/year, ICF said....MORE