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Impacts of the Clean Power Plan on U.S. Natural Gas Markets and Pipeline Infrastructure

Impacts of the Clean Power Plan on U.S. Natural Gas Markets and Pipeline Infrastructure

Full Title: Impacts of the Clean Power Plan on U.S. Natural Gas Markets and Pipeline Infrastructure
Author(s): Advanced Energy Economy
Publisher(s): Advanced Energy Economy
Publication Date: June 1, 2015
Full Text: Download Resource
Description (excerpt):

The AEE Institute contracted with ICF International to perform an assessment of the potential impacts of the EPA Clean Power Plan (CPP) on required gas pipeline capacity. This report responds to concerns raised by some stakeholders, including the North American Electric Reliability Corp. (NERC), that states might rely heavily on natural gas generation for compliance with the CPP, creating stress on gas pipeline capacity and ultimately impacting electric system reliability. These parties have suggested that addressing the concerns might require expensive expansion of natural gas infrastructure over a challenging timeframe.

Using assumptions provided by the AEE Institute, ICF International modeled a series of scenarios. The analysis looked at pipeline expansions between 2016 and 2030 without the CPP, and then determined the incremental capacity requirements prompted by CPP implementation. AEE Institute also directed ICF International to examine how unexpectedly low future gas prices could impact the results by increasing gas demand.

This report finds that ongoing changes in the U.S. natural gas market independent of the CPP are driving increases in pipeline gas infrastructure, prompted by dramatic growth in new gas supplies from areas like the Marcellus and Utica shales. This report further finds that compliance with the CPP, even under an unlikely “stress test” scenario of unexpectedly high gas usage, would only modestly increase the gas infrastructure needs, in the range of 3% to 7%.

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