Anticipated Demand for Natural Gas in the Northeastern United States; Notice of Public Conference

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. PL99-2-000]

Anticipated Demand for Natural Gas in the Northeastern United

States; Notice of Public Conference

April 14, 1999.

Take notice that the Federal Energy Regulatory Commission will

convene a public conference on June 7, 1999, to conduct an inquiry into

anticipated natural gas demand projections in the northeastern United

States over the next 10 to 20 years.\1\

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\1\ For purposes of the conference, this includes those States

lying east of the Mississippi River and north of Tennessee and North

Carolina.

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Currently, there are numerous, varying projections concerning the

growth of natural gas markets in the Eastern United States. These

projections, however, do not shed light on the impact this potential

growth will

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have on existing pipelines. Thus, the Commission believes that it is

important to examine these projections and to understand more about the

assumptions, data sources, and perspectives upon which these growth

forecasts are based.

To this end, the Commission is interested in hearing all views

concerning growth projections in natural gas markets in the

northeastern United States over the next one to two decades and how

these projections correlate to existing pipeline capacity. The

Commission is also interested in learning when this increase in demand

will occur. Will growth occur at varying rates over the next five, ten,

or twenty years? Will the projected demand occur during a certain time

of the year, e.g., during the winter when pipeline use is at its peak

(mainly heating); off peak periods when capacity is more readily

available (mainly air conditioning); or year-round? The Commission

would like to explore the assumptions that underlie these projections.

In addition, the Commission is interested in hearing forecasts

concerning the type of growth that is anticipated. Specifically, the

Commission is interested in determining if the contemplated growth will

serve electric generation facilities, residential customers, industrial

concerns, other consumers, or some combination thereof.

As a secondary matter, the Commission wishes to be informed about

the effect projected growth will have on existing capacity. For

example, where, when, and how much existing capacity is currently

available? If the projected growth takes place as forecast, where will

excess capacity exist in the future? How often will existing facilities

be constrained? Are existing pipeline systems being effectively used?

Is it possible to increase the utilization of existing systems? Will

the projected growth materialize in the form of firm or interruptible

demand for capacity? How much capacity will be available through

releases? How much capacity will be available through turn backs? What

conclusions can be reached concerning how much new capacity may be

required, within what time frame, and in what regions?

The conference will be held at the offices of the Federal Energy

Regulatory Commission, in the Commission Meeting Room, 888 First

Street, NE, Washington, DC 20426.

The Commission seeks the views of the public and all segments of

the energy industry. Any person who wishes to participate in the

conference should submit a written request to the Secretary of the

Commission by May 10, 1999. The request should indicate the scope of

the participants' planned remarks. Speakers that have audio/visual

requirements should contact Wanda Washington at (202) 208-1460.

Any written comments may be filed within 15 days after the

conference.

The Capitol Connection will broadcast live the audio from the

public conference on its wireless cable system in the Washington, DC

area. If there is sufficient interest from those outside the

Washington, DC metropolitan area, the Capitol Connection may broadcast

the conference live via satellite for a fee. Persons interested in

receiving the audio broadcast, or who need more information, should

contact Shirley Al-Jarnai or Julia Morelli at the Capitol Connection at

(703) 993-3100, no later than May 22, 1999.

In addition, National Narrowcast Networks' Hearing-On-The-Line

service covers all FERC meetings live by telephone. Call (202) 966-2211

for details. Billing is based on time on-line.

All questions concerning the format of the conference should be

directed to: Joel Arneson, Office of the General Counsel, Federal

Energy Regulatory Commission, 888 First Street, N.E., Washington D.C.

20426, (202) 208-2169.

By direction of the Commission. Commissioner Breathitt concurred

with a separate statement attached.

David P. Boergers,

Secretary.

Breathitt, Commissioner, Concurring

I agree with the majority that an inquiry into the anticipated

demand for natural gas will provide valuable insight into the

development of a rational certificates policy. As the notice

highlights, there are numerous, varying projections concerning the

growth of natural gas markets. An exploration of the assumptions

underlying these projections will add clarity to the Commission's

analyses. I also believe the questions posed in the notice will elicit

an informative discussion about natural gas markets. While I support

the idea of an inquiry into demand for natural gas, I wish to make

several points with respect to my views about the conference.

First, I would have preferred that the scope of the conference be

much broader. I believe that limiting the conference to the Northeast

fails to recognize a fundamental change that is taking place in the

natural gas industry as a result of the issuance of Order No. 636 in

1992. One of the primary goals of pipeline restructuring was to promote

policies supporting the creation of a national natural gas pipeline

grid. The Commission's efforts in that regard continue to be

successful, not in small part due to our capacity release rules, and

due to the participation of marketers as holders of interstate pipeline

capacity.

For us to restrict this conference to the Northeast does not

recognize the fact that in today's dynamic natural gas market, changes

in capacity serving one region may affect pipeline operations in

another region of the country. New pipeline capacity in the Northeast

could result in changes in the utilization of the systems that now feed

that region--pipelines, say, that originate in the Gulf Coast. For

example, capacity utilization of those pipelines could be reduced as a

result of such expansions. The value and use of capacity release also

could be affected. I believe that broadening the scope of the

conference would have enabled the Commission to look at any ``ripple

effect'' that expansion of the grid anywhere--not just in the

Northeast--could cause in today's marketplace.

Furthermore, I believe that the majority's approach of limiting the

scope of the conference to the Northeast fails to recognize the fact

that other regions of the country are also expected to experience

substantial growth in the demand for natural gas. Certificate filings

that are pending before the Commission and reports in the trade press

indicate to me that projected demand for natural gas in the Mid-

Atlantic and Southeast regions warrant an equal examination by the

Commission.

Finally, I question the timing and the forum that have been chosen

for this inquiry. I do not believe that the Commission has reached a

consensus concerning the ultimate goals of this conference. Before

establishing a public conference, I would have preferred the Commission

to have had a meeting of the minds on our specific objectives for

building a record, and a mutual understanding of how we would want such

a record to be used. I don't believe the Commission has a unified sense

of how this conference fits in with other generic and case-specific

proceedings currently before us. However, I am supporting this inquiry

to the extent it will provide at least a piece of the puzzle about the

future demand for natural gas.

Linda K. Breathitt,

Commissioner.

[FR Doc. 99-9846 Filed 4-19-99; 8:45 am]

BILLING CODE 6717-01-M