Though they live only a few hundred miles from North America's largest and most productive shale gas field, New Englanders still pay the highest energy costs in the continental U.S.
Any explanation for why this densely populated region is still waiting for access to the Marcellus gas play starts with a grass-roots anti-pipeline sentiment, though it's more complicated than that. What isn't hard to understand is that it's costing New Englanders lots of money.
For example, according to Intercontinental Exchange Group Inc., Boston's wholesale gas price averaged $24.09 per million BTUs in January and February, compared with just $10.79 per million BTUs in Chicago and $3.37 in Pennsylvania.
In the previous winter, customers saw their monthly electric bills, already double the national average, rise a whopping 37 percent over the year before.
The hike came as a particularly cruel blow to homeowners who, caught in an equally tight oil market at the time, had to pay as much as $500 to $700 per month to fill household oil tanks. Facing annual energy bills in the thousands of dollars, even the toughest New Englanders are expressing new concerns over the region's economic future.
Compounding the problem is that the region's electric power providers are increasingly dependent on natural gas as a generation fuel now that aging coal, oil and nuclear plants are being retired.
Fifteen years ago, about 15 percent of New England's electric energy production came from generators fueled by gas, notes Marcy Reed, president of National Grid of Massachusetts. Her utility serves all of Rhode Island and more than 1 million customers in Massachusetts.
"By 2014, that number had risen to nearly 50 percent." she said. "Meanwhile, pipeline capacity for gas transmission into New England has not kept pace. ... There is simply not enough gas coming into the region to reliably or affordably power these plants and meet the needs of millions of residential and commercial gas customers."
According to various analysts and regulators, the area would need 1 billion to 2 billion cubic feet of additional capacity to prevent price spikes during peak demand periods.
A recent report released by the New England Coalition for Affordable Energy - a newly formed organization of business and labor groups advocating for the expansion of all means of energy infrastructure throughout the region - quantified the economic consequences should the region remain in its current stasis.
The report estimates that ongoing energy constraints have already cost the region $71 billion, on top of the estimated $7.5 billion in higher energy costs seen over the past three winters.
According to the authors' prognostications, failure to expand new energy infrastructure - including natural-gas pipelines - within the next five years will result in a train wreck of consequences that threaten to jeopardize the region's ability to compete economically, which would hurt job-creation.
http://www.energybiz.com/article/15/09/fighting-new-englands-natural-gas-pipeline-battle
