Title: New England Gas Overview
1New England Gas Overview
- Elements of the System
- Gas Price Considerations
- Discussion
Presented by Chris Fleming Vice President -
Asset Optimization Sithe Energies, Inc.
2Elements of the System
- Pipelines and Supplies
- Capacity
- Who controls it?
- Storage
- Capability to store gas in the region
- Who controls it?
- Markets
- Electric Power Generation
- Traditional LDC Markets
- Combined Market and Capacity Economics
3Pipelines Supplies
4PNGTS
MNE
TGP
Hub Line
Iroquois
New England Pipelines
AGT
TGP
100
0
50
Scale in Miles
5Eastern Canadian (Sable Island)
Western Canadian (Alberta)
3,500,000 DTh/day
12.5
22.5
LNG
Domestic W. Canadian
W. Canadian
65.0
Domestic
Domestic
Sources of Gas (Delivery Capacity)
6MNE Line Expansion
4,100,000 DTh/day
11.0
34.0
LNG
55.0
Sources of Gas (Delivery Capacity)
7Who Controls Gas Delivery Capacity?
3,500,000 DTh/day
LNG
Canadian
Domestic
8Who Controls Gas Delivery Capacity?
4,100,000 DTh/day
LNG
Canadian
Domestic
9Storage
10Regional LNG Storage
Distrigas controls terminal, LDCs control storage
LDC Stg 14,200,000 DTh
Terminal Stg 3,500,000 DTh
Ship Cap 2,800,000 DTh
Vaporization capacity in New England will soon
exceed 2,000,000 DTh/day.
11Markets Capacity Economics
12Source New Energy Ventures, Inc.
13Locations of New CC-Powerplants
Source Energy Ventures Analysis, Inc. (10/00
Study)
14Todays Peak Hour Capacity Needs Hot Summer
15Todays Peak Hour Capacity Needs Cold Winter
16Todays Gas Needs for CC-Power Generation
Heat rate of 7,200 BTU/kwh assumed for
cc-power plant operation, on average
17Todays Gas Needs for Traditional LDC Markets
Firm requirements only. Does not include
interruptible markets.
182001-2002 Total Gas Market/Supply Balance Cold
Year
192001-2002 Total Gas Load Duration Curve Cold
Year
202001-2002 Total Gas Load Duration Curve Warm
Year
212004-2005 Total Gas Load Duration Curve Cold
Year
222004-2005 Total Gas Load Duration Curve Warm
Year
23Capacity Economics
- Capacity cost is high at low load factors.
- Significant capacity likely to remain in hands of
marketers. - Firm capacity from MNE expansion may be
contracted to NY, PJM gencos.
24Prices
25Backflow from Sable will flatten average price
differentials between New England and New York
------
Dracut Hub
26October 2001 Bidweek Basis Differentials
Source NGI Weekly Gas Price Index
AECO-C
0.67
0.30
0.37
Dracut
Chicago
- .07
0.30
PGE
0.64
NY / NJ
Opal
0.30
0.00
The prices of month ahead contracts in New York
and New England are close at present.
Henry Hub (1.87)
27January 2001 Bidweek Basis Differentials
Source NGI Weekly Gas Price Index
AECO-C
11.31
7.14
3.43
Dracut
Chicago
- 5.31
7.96
PGE
2.14
NY / NJ
Opal
8.89
1.01
But basis differentials and the base cost of gas
can vary dramatically, depending on the weather
and wellhead availability.
Henry Hub (9.92)
28When it gets cold, prices can be expected to
spike and availability may even become
constrained if capacity is contracted outside the
region.
?
This suggests a growing need for peakshaving
mechanisms in New England.
29Discussion