New England natural gas overview from publication issued Sept 1/08
http://www.iso-ne.com/pubs/spcl_rpts...

97% nat gas is from North American source

83% from domestic

14% from Canada

2.7% from LNG

In NE ng for home heating 34%, oil 47%

NE (EIA 2006 data) ng consumption by sector

23% residential, 15 % commercial, 11% industrial and 50% electric power generation

Ng demand

Ng as a share of residential home heating fuels is only 34% primarily due to the fact that the greater northeast region of the US is the largest home heating oil market in the world. However current oil prices are triggering massive conversion rates from oil to gas heat within the residential sector.

Ng supply

There is no ng production or underground storage within NE. However ng is stored in the region as above ground in the form of LNG. See page 8 of the attached doc (good read)

LNG impacts on price

2 schools of thought

1 - LNG imports should dampen regional price volatility.

2 – LNG suppliers will seek to maximize their returns by pricing as marginal resource (next highest lamination)

5.2 ng incentives is a good read

5.4 Interactions Between Electric and Natural Gas Market Incentives

Within New England, natural gas has been and is expected to continue as the “fuel-of-choice” for producing electricity. Recently, natural gas has also been referred to as the “bridge-fuel,” the fuel that will transition today’s power sector into the future where cleaner, renewable technologies will eventually blossom to serve a greater portion of the nations electric load. About 75% of the resources in the ISO’s Generator Interconnection Queue plan to burn natural gas. Compared with other fossil fueled resources, this fuel has relatively low emissions, and the plants have a smaller footprint, lower capital costs and shorter construction lead times, all of which make these types of plants attractive and easier candidates to site and build. However the lack of fuel diversity in New England has left the region vulnerable to fuel supply risks in the short and long term, such as those related to winter reliability. Efforts have been made to diversify the existing fuel mix but natural gas-fired generation is very likely to remain the dominant fuel for the generation fleet for the foreseeable future.