Pennsylvania as an Energy and Technology Center
The unexpected energy revolution has the potential to make lasting changes in our economy. The fact that households are paying less for natural gas, less for electricity and much less for gasoline drives consumer confidence and puts more disposable income in peoples’ pockets. This coupled with low interest rates increases spending in an economy, which depends on it for growth. Increased consumer spending and lower energy costs have the same effect on business and industry.
Ten years ago, we wouldn’t have foreseen that the United States – led by Pennsylvania and other shale gas producing regions – would actually make energy independence possible. This revolution is affecting utilities, manufacturing, consumers, business and industry. One of the unexpected benefits is that the United States is now the world leader in reducing greenhouse gas (GHG) emissions. This large reduction hasn’t been achieved by renewable energy (i.e. wind and solar), but from the much lower carbon content of natural gas as opposed to coal and oil.
Long-term, we still need to develop and use renewable energy resources that do not have any direct emissions. However, short-term utilization of the cleanest burning fuel at the highest efficiency possible makes both economic and environmental sense. Not only does natural gas have low carbon content, but many of the technologies that use natural gas as a fuel operate at much higher efficiencies compared with traditional energy technology. The historic availability of natural gas and oil made the Gulf Coast region, Texas in particular, the heart of the energy industry in the United States. There is no reason that Philadelphia and the surrounding region cannot similarly become an energy and technology center.
Areas that are directly impacted by the changes in the natural gas supply include the intrastate and interstate natural gas pipelines. New pipelines or existing pipeline expansions happen regularly. The interstate system was largely designed to move natural gas from the Gulf of Mexico and neighboring states to markets in the Mid-Atlantic and Northeast. New construction is improving that system and adding west-to-east capacity to move new supplies to market. We are now seeing prices decoupling from the traditional Gulf Coast transportation index as supplies much closer to population centers become available. The result is stable and historically low cost natural gas.
This entire post can be found published on Philadelphia's Region
Business Journal Here.
Contributors: Michael Fischette, CEO & Joe Sullivan, VP Energy Policy & Development
Date: April, 2014