Nicholas Newman February 2017
The advent of rising gas supplies has allowed the US and Mexico, in particular, to raise gas consumption and cut their greenhouse gas emissions. In Europe, where energy security and renewables enjoy priority, gas has always been important. In all three markets, emissions are lower.
This feature provides an overview of the experiences of three distinct markets.
The U.S. is now the world’s biggest gas producer, producing about 80 Bcf/day (Billion cubic feet per day), which is some 25% of the world’s total output, suggests Platts. This is despite the US market experiences low prices for some years, proven gas reserves now stand at over 400 Tcf, a 33% increase since 2011 alone. Such an increase in forecast output will allow the US to become the world’s third-largest exporter of liquefied natural gas according to the EIA. Burgeoning supply of shale gas forced prices down from over $8 per MBtu (Million British thermal units) in 2008 to $2.26 MBtu in November 2016. US natural gas fired powered generation increased 19 percent in 2015 because of low gas prices, increased gas-fired generating capacity and coal power plant closures. In 2016, natural gas accounted for 32 percent of electricity generation and exceeded coal’s contribution. Karen Sund, partner and founder of Sund Energy AS, points out that “US potential demand is likely to grow since low prices help” expand demand. The switch to shale gas reduced US greenhouse gas emissions by 12 percent on levels in 2005.