It has been a brutal three days.
Ready for some good news? Or at least good news for consumers, our economy, and the environment, though not for gas producers.
Natural gas in 2012 has averaged a low, low $2.78 for a thousand cubic feet at the Henry Hub, according to the EIA. www.eia.gov/forecasts/steo/pdf/steo_full.pdf. An amazing bargain that is driven home by remembering 2008, pre-shale gas boom prices
In 2008, prior to the shale gas boom unleashing trillions of cubic feet of new supply, the price of natural gas averaged $8.86 at the Henry Hub. www.cga.ca/publications/documents/Chart8-NaturalGasPrices.pdf.
Shale gas supplies have cut $6 off the price of natural gas. A typical Pennsylvania family using natural gas to heat their home uses about 90 mcf per year and so has saved $540 in 2012.
And cheap gas has meant lower carbon emissions, lower toxic air emissions, and lower soot pollution, as natural gas displaces coal and oil at homes, factories, and power plants. Natural gas-fired generation this year will provide more than 30% of US electricity, while coal-fired generation fell to about 37% of all electricity supplied. By comparison, in 2000, coal-fired generation provided more than 50% of US electricity and still provided 48% in 2008.
And while gas prices have been low, wind, solar, and energy efficiency have boomed too from 2008 to 2012. Next year will bring more big gains for solar and efficiency, but new wind generation will fall, as a result of the delayed wind PTC extension.
Cheap gas has combined with renewable energy and energy efficiency to benefit mightily consumers, our economy, and our environment.