Bentek: Natural gas-fired generation projected to increase 15% or 170 MM MWh/year by 2017

Tuesday, December 11, 2012

In 2012, power demand growth signaled the start of a symbiotic natural gas market super cycle, in which U.S. supply and demand growth necessarily will be highly correlated.

Bentek Energy, a leading energy markets information and analytics company, recently released a new Market Alert, Power Jump-Starts New Gas Market Cycle, that forecasts natural gas-fired generation to increase 15%, or 170 MM MWh/year by 2017, stealing market share from coal in power generation. Low natural gas prices have enabled gas to capture an incremental 7 Bcf/d of power market share from coal in 2012. Gas now holds a greater share of the U.S. power market than it ever has, and over the next five years its share will continue to increase, reaching 32% in 2017 compared to 29% this year and 17% in 2005. Gas is expected to become an increasingly dominant fuel source for baseload, intermediate and peaking power generation, while coal’s share of the power market continues to decline.

Bentek’s Power Jump-Starts New Gas Market Cycle identifies emerging trends in power generation demand, the drivers behind it, the resulting impacts on gas transportation, prices and regional and U.S. gas demand, flows, production and basis, including a five-year outlook. It establishes the case for power demand growth signaling big changes in the market, including a new gas market cycle with the return of price volatility, higher prices, the reversal of gas basis relationships between regional markets, and potential constraints and risks related to gas-electric coordination.

To access a complete copy of this report please click here.