Natural Gas

Exporting LNG Could Bring US Gas Prices on Par with World Pricing

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This is a article from Fuel Fix reporting the first customer for the Sabine Pass terminal. This would make the US an energy exporter but it will also add new customers to the demand curve for natural gas. This could cause the US pricing to move closer to the world pricing. The price of natural gas fired generation electricity pricing may impacted.

LNG export terminal gets first major customer
by Tom Fowler in Commodity Trading, LNG, Natural Gas, Newsletter, North America
Cheniere Energy Partners’ LNG import terminal on the Louisiana side of Sabine Pass

The U.S. is one step closer to being an energy exporter once again.

Houston-based Cheniere Energy Partners said it has signed its first long-term customer to buy liquified natural gas for export from its Sabine Pass terminal on the Texas/Louisiana border.

The LNG sale and purchase agreement with a division of U.K.-based BG Group for 3.5 million tonnes per year of LNG over 20 years. Put another way, that’s 178 Bcf per year, or about 0.5 Bcf per day. …

Electricity

Clean Energy Standard Will Increase Electricity Costs

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Today the Energy Information Administration released an analysis on the Clean Energy Standard.

“A CES is a policy that requires covered electricity retailers to supply a specified share of their electricity sales from qualifying clean energy resources. Under a CES, electric generators would be granted clean energy credits for every megawatt-hour (MWh) of electricity they produce using qualifying clean energy sources. Utilities that serve retail customers would use some combination of credits granted to their own generation or credits acquired from other generators to meet their CES obligations. Generators without retail customers or utilities that generated more clean energy credits than needed to meet their own obligations could sell CES credits to other companies.”

Near the end of the analysis:

“The HCES impact on electricity prices varies significantly across regions (Table 1). In 2035, the HCES impact on average electricity prices ranges between negative 1.6 cents/kWh (indicating that the average electricity price is actually lower under the HCES than the reference case) and positive 8.4 cents/kWh. Regions that are more dependent on generation fuels that are not HCES-eligible, primarily coal, in general experience a stronger price impact.”