Governor Kitzhaber announces awards to spur compressed natural gas market in Oregon

(Salem, OR) — Governor Kitzhaber today announced awards for eight projects that will advance alternative fuels across the state. Oregon Department of Transportation will award a total of $4 million in federal Congestion Mitigation Air Quality Funds to qualified projects to spur the compressed natural gas (CNG) market in Oregon and diversify fuel options for Oregon consumers.

“Today we take an important step forward in diversifying our fuel supply,” Governor Kitzhaber said. “These awards will support projects that help Oregonians transition to lower-cost, lower-carbon clean fuel.”

The Governor’s 10-Year Energy Action Plan calls for converting 20 percent of Oregon’s large fleets to alternative fuels in the next 10 years. Transportation is the single largest contributor to Oregon’s greenhouse gas emissions, accounting for 37 percent of total emissions. CNG offers lower greenhouse gas emissions than gasoline or diesel.

Five projects located along the I-5 corridor from Portland to Sutherlin will provide CNG fueling stations for a variety of businesses located throughout Oregon. Other projects will make investments in Oregon communities that currently lack CNG infrastructure, such as Bend. Projects were selected based on a variety of factors, including location, reduction in air emissions, and public benefit.

“A resilient economy is less reliant on the boom/bust cycle of a single fuel source,” said ODOT Director Matt Garrett. “Diversifying our fuel supply provides options and helps businesses and local governments save money on their fuel bills, freeing up money they can reinvest.”

The winning projects: City of Wilsonville, City of Bend, Clean Water Services (Hillsboro), Smalley Trucking (Sutherlin), Tyree Oil (Roseburg), Fitz Enterprise (NE Portland), Metro (NW Portland) and TriMet (Beaverton).

The award recipients – seven CNG fueling stations and one renewable natural gas fueling station – will be used for different services, including transit, public fleets, and waste haulers. The announcement comes the same week as the opening of a new public CNG fueling station in Eugene.

NGSA 2014 Summer Outlook Indicates Slight Upward Pressure on Natural Gas Prices Compared to Summer 2013

(Washington, D.C.) – Pressure on natural gas prices is likely to be slightly upward this summer compared to summer 2013, the Natural Gas Supply Association (NGSA) today said in its annual Summer Outlook assessment of the natural gas market. Using published data and independent analyses, NGSA’s 2014 Summer Outlook for Natural Gas evaluated the combined impact of the weather, economy, customer demand, production activity and storage inventories on the direction of natural gas prices for the coming summer, compared to the same data for the summer of 2013 when Henry Hub prices averaged $3.77 per MMBtu.

NGSA emphasized that the upward pressure on prices is summer over summer and does not include data on winter prices.

“When NGSA weighed all the different factors, the picture that emerged for this summer is one of slightly increased pressure on natural gas prices, chiefly because of the need to inject a greater than average amount of natural gas into storage in the wake of an extreme winter,” said Greg Vesey, Chairman of NGSA and Vice President of Gas Supply and Trading for Chevron. “Looking at all key factors combined, NGSA expects soft upward pressure on prices compared with last summer.”

Key Supply Factor for Summer 2014 – PRODUCTION

NGSA’s 2014 Summer Outlook predicts that a record-setting amount of natural gas will be produced this summer compared to summer 2013, placing downward pressure on prices. In contrast, imports and exports are expected to remain at similar levels to last summer.

Vesey said, “Our analyst expects production to be record-setting in part because of shale gas and in part due to a considerable amount of natural gas currently being produced in association with oil- and liquids-directed drilling. Finally, production is robust because of the numerous new pipelines and processing plants in service that are carrying previously- stranded natural gas away from the Marcellus and other production areas.”

Key Demand Factor for Summer 2014 – STORAGE

Turning to summer demand for natural gas, NGSA projected that pressure to bring storage to adequate levels before the winter heating season will place upward pressure on prices this summer compared to summer 2013. NGSA estimated an average of 83 Bcf/week in storage injections. Vesey said, “We have confidence in the market’s resilience and ability to achieve those record weekly injections, thanks to the industry’s responsiveness and the abundance of shale gas. It’s a testament to the flexibility of our industry that we were able to average storage injections of 79 Bcf/week even back in 2003, long before shale gas had increased production to our current record-setting levels.”

Key Trend to Watch – CUSTOMER DEMAND

NGSA predicted that the industrial sector will increase its summer gas demand by 5 percent compared to summer 2013, primarily because of numerous new natural gas-intensive industrial projects. [Slides 7, 10] However, this summer’s industrial demand increase is predicted to be offset by a drop in electric demand compared to summer 2013. NGSA explained that summer electric demand is projected to decline because less coal-to-gas fuel switching is forecasted than occurred in the summer of 2013. Coal-to-gas switching is a short- term, purely price-driven phenomenon that occurs when natural gas-fired power plants are dispatched instead of coal-fired plants.

Vesey said, “Fuel switching is a temporary response. In contrast, the installation of new gas- fired electric capacity indicates that the long-term electric demand for natural gas is growing and will continue to increase over the next few years.”

In brief, NGSA’s analysis of individual supply and demand factors showed:
Weather –Temperatures similar to the summer of 2013 are expected to place neutral pressure on natural gas prices compared to last summer. Energy Ventures Analysis predicts summer 2014 weather that is 1 percent warmer than last summer.

Economy –Improved unemployment numbers, the highest Consumer Sentiment Index numbers since 2007 and summer 2014 GDP growth expected to exceed last summer’s are encouraging, but the incremental improvement is not quite large enough to influence prices. NGSA expects the economy to place neutral pressure on natural gas prices this summer.

Demand – Customer demand is expected to exert neutral pressure on prices summer-over-summer. The expectation for improved demand from industrial sector of 5 percent is offset by a projection for 3 percent electric sector decline due to less coal-to-gas switching by price-sensitive generators. Residential/commercial demand is predicted the same as summer 2013.

Storage –Record weekly storage injections averaging around [83] Bcf/week are expected to bring storage to 3,400 Bcf by the end of the injection season. The estimated size of storage injections is projected to place upward pressure on prices compared to the summer of 2013.

Production – Record-setting summer production estimated at 68.5 Bcf/day is expected to exert downward pressure on prices.

NGSA used data from: Energy Ventures Analysis (EVA) for its demand projections; Energy Information Administration for production projections; IHS Global Insight for economic projections; and NOAA for weather. The association does not project actual figures for wholesale or retail market prices.

For more information, please see NGSA’s 2014 Summer Outlook for Natural Gas Executive Summary and NGSA’s 2014 Summer Outlook PowerPoint presentation at


NGSA represents integrated and independent companies that supply natural gas. Established in 1965, NGSA encourages the use of natural gas within a balanced national energy policy, and promotes the benefits of competitive markets to ensure reliable and efficient transportation and delivery of natural gas and to increase the supply of natural gas to U.S. customers. Visit and for more information.

NW Natural to Credit $11 Million to Oregon Customers on June Bills

PORTLAND, Ore. –Northwest Natural Gas Company, dba NW Natural (NYSE:NWN), will issue an Interstate Storage credit to its Oregon customers on their June bills for the 13th year in a row.

This year’s credit is for approximately $11 million and will equate to about $12 for the average residential customer in Oregon or nearly $48 for the average commercial customer.

The credit is being given because of efficient pipeline capacity management and effective use of the company’s underground natural gas storage facility in Mist, Oregon, during the 2013 calendar year. The technique used to make the most of these resources is called “optimization.”

In the last 13 years, savings provided back to customers from the company’s Mist gas storage operations have totaled more than $96 million.

AGA: Flexible Approach Allows for Efficient and Affordable Applications of Clean Natural Gas

Washington, D.C. – The American Gas Association (AGA) issued the following statement on the announcement by the Environmental Protection Agency (EPA) of a proposed rule under Section 111(d) of the Clean Air Act:

“The American Gas Association believes it is critical that the rule design include a flexible approach for compliance and allow for the efficient and affordable applications of clean natural gas,” said Dave McCurdy, President and CEO. “Natural gas used directly in homes and businesses, and technologies such as combined heat and power, are key parts of a clean and secure energy portfolio for our nation. Natural gas delivers solutions for our economy and our environment and local natural gas utilities bring those benefits home.”

Direct use

·         Natural gas consumed directly in appliances for heating and cooling, water heating, cooking and clothes drying achieves 92 percent energy efficiency.

·         A household with natural gas versus all-electric appliances produces 37 percent lower greenhouse gas emissions.

·         Converting natural gas or any other fossil fuel into electricity to power comparable electric end-use products only maintains 32 percent of usable energy.

Combined heat and power (CHP)

·         Using American energy, labor and knowledge, CHP can generate electricity and capture useful heat simultaneously to increase the overall efficiency of an energy system.

·         The use of natural gas, the preferred fuel choice for CHP applications, allows for new electricity generation to meet current and future demand at costs up to 50 percent less than traditional forms of delivered new baseload electricity.

·         CHP uses less fuel and emits lower levels of greenhouse gases using established technology that can reduce energy costs to businesses and help reduce their environmental footprint.