Natural Gas Term of the Week: Gasification

What it means: The process during which liquefied natural gas (LNG) is returned to its vapor or gaseous state through an increase in temperature and a decrease in pressure.

See it in action: While LNG is an excellent method for the storage and transport of natural gas; conventional use requires it to be warmed from its liquid form at -160c (-256f) back to a gas. This physical process involves slowly warming the LNG through a series of pipes and vaporizers. Four NWGA members own and operate their own LNG facilities as a means of providing extra capacity in times of high demand, they are:

  • FortisBC, on Vancouver Island and in Delta, BC
  • Intermountain Gas, in Nampa, ID
  • NW Natural, in Portland, OR and Newport, OR
  • Williams NW Pipeline in Plymouth, WA

Each facility cools natural gas down for storage during periods of low demand to be stored as LNG; once needed, this LNG undergoes gasification and is added to the system to ensure adequate supply for customers.

AGA: Natural Gas System Delivered As Promised During Record Winter

Washington, D.C. – The natural gas delivery system in the United States achieved historic levels of performance this past winter. More natural gas was delivered through more pipelines to more customers than ever before, and customer bills remained affordable. The American Gas Association (AGA) today released Promise Delivered, a study of the planning, preparation and performance of the natural gas system during the 2013-14 Winter Heating Season.

“America’s natural gas utilities prepare every year, knowing that the eventuality of an extraordinary winter may be just around the corner. That event clearly materialized during the 2013-14 winter heating season,” said AGA Chairman Gregg Kantor, who is also the President and CEO of NW Natural in Portland, Ore. “Utilities plan all year for the possibility of extreme temperatures and employ a portfolio approach to gas purchasing and storage utilization, with the idea of meeting customer requirements affordably even on the coldest days of the year. Before last year’s extraordinary winter concluded, LDCs were already preparing for the next winter cycle. Reliable performance is what our customers have come to expect from us, and you can’t get there without this level of planning and preparation.”

The United States faced extreme temperatures and record-setting natural gas consumption during the 2013-2014 winter heating season, which is defined as November 2013 through March 2014. This past winter also saw the top five days for natural gas consumption for the country as a whole. On January 7, 2014, the United States set the single day record for natural gas consumption at 139 Bcf – almost double the daily average. Families used more natural gas than ever to keep warm, and power generators pulled unprecedented volumes of gas to maintain electric system reliability. In addition, industrial demand of natural gas surged, and even exports to Mexico were consistent.

Despite these record conditions, residential customer bills increased only 10 percent on average from the prior winter – an increase mostly due to higher consumption. AGA expects relatively warmer temperatures this coming winter based on information from the climate Prediction Center, which may lead to a reduction in demand. Natural gas prices are likely to be slightly higher, resulting in an increase in customer bills of about seven percent this winter.

AGA President and CEO Dave McCurdy said, “A new bar has been set. Our nation has an incredible abundance of natural gas and a pipeline network that is the safest energy delivery system in the nation. As more homes and businesses continue to rely on natural gas, and we see increased and strategic use of American natural gas across all sectors, we are confident that utilities will continue their record of reliability, delivering clean and affordable energy.”

The United States now produces approximately 14 billion cubic feet (Bcf) more today on a daily basis than in 2002-03, a similarly cold winter in the U.S., and natural gas reserves have also grown by almost 63 percent in the past decade. In addition, natural gas working storage capacity has increased by more than 18 percent in the same period, as utilities and others have added storage capacity by building, or have contracted for sufficient volumes in order to assure storage was available when it was needed most. This growth has been accompanied by increased efficiency as residential and commercial sector use per customer has declined by 25 percent from 2003 levels. More than 177 million Americans use natural gas, and our nation’s pipeline network has expanded more than 11 percent compared to ten years ago.

Further examination of critical storage inventories shows that working gas injections have remained solid with national inventories at 2.9 Tcf for the week ending September 12, according to the Energy Information Administration. After a three-week warm stretch nationally late in the summer, temperatures have moderated, leaving a strong supply picture for continued injections during September and October. This fact, along with a net injection season that can continue past November 1, points to an ending inventory which may reach 3.5 Tcf.

“This winter was not only a validation of years of efforts by utilities, pipelines, producers and regulators, it was a signal that continued investments, planning and analyses are prudent and necessary as we begin to understand this era of resource abundance and accompanying opportunities for our economy,” said McCurdy. “We expect the trend of greater demand to continue, and it will be accompanied by substantial growth in domestic natural gas supplies and increased infrastructure development to deliver this gas to more customers. This supply-demand balance lends itself to continued market stability, thereby creating more opportunities for natural gas in our nation.”

Alpha Natural Resources Selects Plum Energy to Supply LNG for Eagle Butte Mine Haul Trucks

Alpha Natural Resources, Inc., announced today that Plum Energy LLC will construct a liquefied natural gas (LNG) plant on property adjacent to Alpha Coal West Inc.’s Eagle Butte Mine, near Gillette, Wyoming. The Plum Energy facility will supply LNG to Alpha Coal West’s mine haul vehicles, producing cost efficiencies and fuel savings for its mining operations.

Natural gas becomes LNG when the gas is cooled to more than 260 degrees below zero and the volume becomes 1/600th of the gaseous form, turning the gas into a liquid fuel. LNG is a clean, efficient fuel and is extremely attractive from a price point when compared to the cost of conventional diesel fuel.

Alpha Coal West began testing LNG technologies developed by GFS Corp. in trucks at the Belle Ayr Mine in 2012, beginning a pilot program of the world’s first LNG-powered mine haul trucks. After 18 months of daily operation, Alpha Coal West decided to proceed with the conversion to LNG of its 16 Caterpillar 793 haul trucks at the nearby Eagle Butte Mine. Alpha Coal West expects the alterations to the trucks, each of which is capable of hauling 240-tons of coal, or the equivalent of two railroad cars, to be completed by the end of 2014.

Plum Energy’s LNG plant at the Eagle Butte Mine, scheduled to come online in March 2015, will be able to produce 28,500 gallons of LNG a day. In addition, Plum Energy has designed an LNG refueling station that will be constructed on-site at Eagle Butte, which will be capable of refueling eight trucks simultaneously.

“We are delighted to assist in bringing cleaner burning, lower cost LNG to Alpha Coal West and to Wyoming,” said Kirt Montague, chief executive officer of Plum Energy. “This project not only will reduce fuel costs for Alpha Coal West, but will also help solidify supply lines for other LNG users in the Powder River Basin.”

Alpha Natural Resources President Paul Vining says, “The construction of the LNG plant fits with ongoing efforts to control costs. Switching the Alpha Coal West fleet to the combined use of LNG and diesel will also lead to more efficient operation and longer engine life for the trucks.”

“We are excited by this development,” said Jason Green, President and CTO of GFS Corp. “Alpha Natural Resources continues to demonstrate their vision of a more sustainable and efficient future for mining operations. They have been a terrific partner and we are committed to continuing to provide them with state of the art natural gas + diesel solutions for their fleet.”

Alpha Coal West’s demand for LNG is expected to be about 6,400 gallons a day to fuel its trucks. As the plant grows, excess product can be sold to other companies in the area as they convert their haul trucks and other equipment to the lower emission and cost-efficient LNG.

Avista Makes Annual Price Adjustment Requests in Washington

SPOKANE, Wash. Avista filed its annual Residential Exchange Program and Purchased Gas Cost Adjustment (PGA) requests that would result in a 0.6 percent decrease in electric revenue, and increase natural gas revenue by 1.2 percent in Washington, if the requests are approved by the Washington Utilities and Transportation Commission (UTC). A Nov. 1, 2014 effective date was requested for the two adjustments, which have no impact on company earnings.

Electric Adjustment

The electric adjustment is related to the Bonneville Power Administration (BPA) Residential Exchange Program. The Residential Exchange Program provides a share of the benefits of the federal Columbia River power system to the residential and small farm customers of the investor-owned utilities in the Pacific Northwest, including Avista. Avista applies the benefits it receives, which typically fluctuate from year to year, to customers as a credit on their monthly electric bill.

In 2014, Avista received a higher level of benefits than it had projected in last year’s rate adjustment. As a result of the increased level of benefits, residential and small farm customers using an average of 965 kilowatt hours per month could see their monthly bill decrease from $80.09 to $79.03, a decrease of $1.06 per month or 1.3 percent, effective Nov. 1, 2014, if the UTC approves Avista’s request.

Natural Gas Adjustment

The annual Purchased Gas Cost Adjustment (PGA) is filed each year to balance the actual cost of wholesale natural gas purchased by Avista to serve customers with the amount included in rates. This includes the natural gas commodity cost as well as the cost to transport natural gas on interstate pipelines to Avista’s local distribution system.

If the request is approved by the UTC, an Avista residential customer using an average 65 therms per month could expect his or her bill to increase by $0.77, or 1.3 percent, for a revised monthly bill of $61.96 beginning Nov. 1, 2014. The filing would result in an overall increase of 1.2 percent or $1.9 million. Avista serves approximately 150,000 natural gas customers in Washington.

The primary driver for the company’s requested increase is related to increased wholesale natural gas prices which were caused, in part, by a colder than normal winter throughout the United States this past heating season. The colder than normal winter led to an increase in overall natural gas demand and a heavy reliance on natural gas storage reserves. The cold weather and increased demand put upward pressure on natural gas prices during the winter and this trend continued as natural gas companies have been replenishing their natural gas storage facilities.

To help customers proactively manage their energy use, Avista offers a number of energy efficiency programs, energy-saving information, rebates and incentives. Avista also provides energy assistance programs and payment options for qualifying customers. Information about these customer programs and options is available at www.avistautilities.com.

AGA Launches Threat Information Sharing Center for Natural Gas Utilities

Washington, D.C. – The American Gas Association (AGA) today launched a new tool to help further enhance the security of natural gas utilities. The Downstream Natural Gas Information Sharing and Analysis Center (DNG ISAC) is a platform for sharing cyber and physical threat intelligence, incident information, analytics and tools. Now fully operational, the DNG ISAC will help local natural gas utilities throughout the nation share and access timely, accurate and relevant threat information as part of their continued commitment to the safe and reliable delivery of natural gas to the more than 177 million Americans who rely on it to meet their daily needs.

“Information-sharing is a fundamental pillar of a robust cyber and physical defense effort,” said AGA President and CEO Dave McCurdy. “The DNG ISAC is tailored to address the distinct operational needs of the downstream natural gas sector and provides the technological sophistication and coordination necessary to meet the ever-changing threats of the 21st century.”

Information Sharing and Analysis Centers (ISACs), as described by the National Council of ISACs, are trusted entities established by critical infrastructure sectors to provide comprehensive analysis that may be shared within the sector, with other sectors and with government. ISACs take an all-hazards approach to combating threats with services including risk mitigation, incident response, alert systems and information sharing. There are currently more than one dozen ISACs covering a wide range of industry sectors, including the electric, nuclear, financial, telecommunications, information technology and water industries. Combination gas and electric utilities, which already access the Electric Subsector (ES) ISAC for electric threat information, will eventually also be able to access the DNG ISAC, and vice-versa. This integration of the two ISACs will strengthen situational awareness of these two industries for the ultimate benefit of their shared customers.

Partnership between the private sector and the federal and state governments is the key to addressing cybersecurity threats to our nation’s critical infrastructure. In addition to facilitating the sharing of best practices among its more than 200 member companies, AGA chairs the Cyber Security Working Group for the Oil & Natural Gas Sector Coordinating Council, an operators’ forum supported by the U.S. Department of Energy, in coordination with the U.S. Department of Homeland Security, to promote effective security strategies and activities, policy and communication across the oil and natural gas sector to achieve the nation’s homeland security mission.

“AGA and our member companies continue to take a leading role in efforts to help ensure the security and resiliency of the natural gas delivery system – allowing customers and the nation to benefit from our abundance of clean, domestic natural gas for decades to come,” said McCurdy. “A natural gas utility’s ability to deploy the best cybersecurity defense for their system depends on an environment that fosters increased operator awareness of cyber-attacks and intrusion activities, increased information sharing, flexibility to utilize appropriate cybersecurity platforms and increased training. The DNG ISAC will play a key role in facilitating that environment.”

Legislative Energy Horizons Institute Concludes First Session for 2014 Class

Richland, WA — The Legislative Energy Horizon Institute (LEHI) brought together 34 state and provincial legislative energy leaders in its 2014 class for the first thirty hours of the acclaimed certificate program August 23 – 26 in Richland, Wash. Founding LEHI sponsors include the Northwest Gas Association and NWGA member companies Puget Sound Energy and Spectra Energy.

In its sixth year, the Institute offers policymakers the chance to dramatically improve their knowledge of the energy infrastructure and delivery system, enhancing their ability to make the complex policy decisions that will be necessary to ensure the region has a stable, secure and affordable energy supply and delivery system. The three-and-a-half day session in Richland focuses its in-depth curriculum on how energy infrastructure operates, and the complex issues associated with electricity, natural gas and petroleum infrastructures, regulations and interdependencies.

“It is critical that citizen legislators get this basic boot camp of how our energy infrastructure works, is built and operated so they make informed policy decisions about our energy future,” said Jeff Morris, Institute Director.

Outside of thirty hours of class time on electricity, oil and gas, integrating renewables, alternative fuels for transportation and the smart grid, most of the class toured the Columbia Nuclear Generating station and the Nine Canyon Wind Farm, both operated by Energy Northwest.

Over 100 policymakers have attended the Institute. Those completing the 60 hour executive course get a Certificate from the University of Idaho in Energy Policy Planning. These Alumni have gone on to become leaders in their respective state and provincial governments in energy, chairing energy or environment committees.

Two of the three Western Canadian Energy Ministers have graduated from the program.

The next in-person session will take place in Washington, D.C. November 13 – 15, 2014.

 

ABOUT LEHI

The Legislative Energy Horizon Institute (LEHI) educates legislators on the North American energy infrastructure and delivery system. The Institute was created through a partnership between the Pacific NorthWest Economic Region (PNWER) and the National Conference of State Legislators (NCSL) along with the University of Idaho and the Department of Energy. High turnover in legislatures decreases the institutional knowledge of complex energy issues. Legislators who develop energy policy often lack a comprehensive understanding of how energy infrastructure operates. The complex issues associated with electricity, natural gas and petroleum infrastructure; regulation governing this infrastructure; and interdependencies are just some of the areas that legislators must understand to make responsible and informed policy decision.

Class of 2014

Alaska

Representative Dan Saddler

Representative Doug Isaacson

Representative Bryce Edgmon

Alberta

MLA Alana DeLong MLA David Dorward

Arkansas

Representative Lane Jean

British Columbia

MLA Mike Bernier

California

MLA Sebastian Ridley-Thomas

Colorado

Representative Dominick Moreno

Senator Matt Jones

Florida


Representative Jose Felix Diaz

Idaho

Representative Kelley Packer

Representative Phylis King

Representative Janet Trujillo

Illinois

Senator Dave Koehler

Minnesota

Senator John Hoffman

Montana

Representative Patricia Peppers

New York

MLA Angelo Santabarbara

Oregon

Representative Jeff Reardon

Representative Mark Johnson

Senator Arnie Roblan

Representative Caddy McKeown

Senator Alan Olsen

Senator Bill Hansell

Quebec

MNA Guy Bourgeois

Ohio

Senator Joe Uecker

Texas

Representative Ken King

Washington

Representative Cindy Ryu

Representative Chad Magendanz

Representative Zack Hudgins

Staff Debbie Driver

Staff Clay Hill

Western Governors Association

Policy Staff Christopher Scolari

Finishing Course in 2013 DC session

Alberta Minister Cal Dallas

Washington Senator Andy Billig

Northwest Territory Min. David Ramsay

NW Natural teams up with American Red Cross for Natl. Preparedness Month Events

PORTLAND, Ore. – The American Red Cross and NW Natural are teaming up during National Preparedness Month to help Oregonians and Southwest Washingtonians prepare for a natural disaster or emergency. During the month of September, Get Ready events will be held in the eight communities of Portland, Vancouver, Salem, Albany, The Dalles, Seaside, Lincoln County, and Coos Bay.

The events are free to the general public. The first 100 families will receive small Red Cross emergency kits. Free lunch will be provided at most locations, as well as safety demonstrations, kids’ activities and materials from local emergency groups. There is no need to register; attendees can just show up.

“These community gatherings are fun and a great way to introduce family conversation about what to do, where to go and who to rely on should a disaster occur,” said Cara Sloman, regional disaster program officer for the American Red Cross Cascades Region. “A wealth of resources are on site at each event, thanks to the coordinating efforts of NW Natural.”

Here are the details on who will be joining the American Red Cross Cascades Region and NW Natural for each event:

* Get Ready Portland, September 6 —Unthank Park, 510 N Shaver St., Portland, from 11 a.m. to 1 p.m., joined by Portland Fire & Rescue, Multnomah County Office of Emergency Management, Portland Bureau of Emergency Management, Portland Police, DOGAMI, Legacy Emanuel Hospital, AMR, Oregon Food Bank and Self Enhancement Inc.

* Get Ready Vancouver, September 6 – NW Natural and the Red Cross will have our Get Ready table at CRESA’s Community Expo from 11 a.m. to 2 p.m. (Note: we are not providing free lunch at this event).

* Get Ready Coos Bay, September 13 – Coos Bay Fire Station on Elrod Ave. from 11 a.m. to 2 p.m., joined by Coos Bay Fire Department, Coos County Emergency Management, Coos Bay Police, North Coos 911 Center, Bay Cities Ambulance, South Coast Preppers, Hazmat Team 15, Coast CPR, Pacific Power, Car Seat Coalition, Coos County Assessor’s Office, Salvation Army, Bay Area Hospital and more.

* Get Ready Salem, September 20 — Salem Riverfront Park, North Meadow, Rotary Pavilion, from 10:30 a.m. to 2 p.m., joined by Salem Fire Department, Salem CERT, Oregon Office of Emergency Management, Rural/Metro Ambulance, Salem Health, and Polk County Sheriff Marine Patrol.

* Get Ready The Dalles, September 20 – Mid-Columbia Fire & Rescue, 1400 W 8th St., The Dalles, from 10 a.m. to 2 p.m., joined by Wasco County Sheriff’s Office, CERT, Medical Reserve Corps, Lifeflight, Food Bank, OSU Extension Service and SERVPRO.

* Get Ready Albany, September 27 – Gibson Hill, 2880 Gibson Hill Road, Albany, from 11 a.m. to 1 p.m., joined by Linn County Emergency Management, Linn County CERT, Linn County Medical Reserve Corp, Albany Fire Dept., Albany Police, Mid-Valley LEPC, Linn County, Amateur Radio, the local food bank, humane society and more.

* Get Ready North Coast, September 27 – Seaside Fire Dept., 150 South Lincoln, Seaside, from 11 a.m. to 1 p.m. joined by Seaside Fire Department, Oregon Office of Emergency Management, Lutheran Disaster Response, Clatsop County Amateur Radio Emergency Services, and Clatsop County Emergency Management.

* Get Ready Lincoln County, September 27 – North Lincoln Fire & Rescue District #1, Taft Fire Hall, 4520 SE Hwy 101, Lincoln City, from 11 a.m. to 2 p.m., joined by North Lincoln Fire & Rescue, Lincoln City Police and Lincoln County Sheriff, CERT, United States Coast Guard, SERVPRO, Lincoln City Electronic Super Store, Lincoln County School district and more.

“We’re pleased to host a series of readiness events with the Red Cross for the third year in a row,” said Von Summers, NW Natural community affairs manager. “Safety is a top priority for NW Natural and we want to help our communities prepare for any natural disaster that might occur.”

Natural Gas Term of the Week: Biomethane

What it means: Biogas, produced through the anaerobic digestion of organic matter, that has been upgraded to purity levels making it interchangeable with natural gas.  Also referred to as “renewable natural gas”, biomethane can be sourced from all manner of decaying matter, from agricultural byproducts including cow manure to purified landfill gas.

See it in action: FortisBC and NW Natural are among the NWGA members getting behind biomethane. Both have programs allowing utility customers to purchase some portion of their monthly natural gas usage as biomethane, reducing their carbon footprint.

Local waste collectors are also working on turning the organic waste they pick up into valuable fuel. Waste Management, the largest trash collector in the US, recently announced a joint venture with the aim of turning the biogas they produce into liquid vehicle fuels. In the region, Columbia Biogas near Portland is also in the process of developing a waste to gas facility.

For a more in depth overview of FortisBC’s program carve 3 minutes out of your day and check out this video:

Follow the NWGA on Twitter: @Ben_at_NWGA

8/11 Serves as Reminder to Call 811 Before Digging

PORTLAND, Ore. — NW Natural (NYSE:NWN) hopes this date, 8/11, will serve as a reminder to call 811 before digging to have underground utility lines marked. Every six minutes a line is damaged because someone decided to dig without first calling 811.

“On Aug. 11 and throughout the year, we remind homeowners and contractors to call 811 before digging to eliminate the risk of striking an underground utility line,” said Scott Gallegos, compliance supervisor for NW Natural. “It really is the only way to know which lines are buried in your area.”

Striking a gas pipeline can cause injury, repair costs, fines and inconvenient outages. That’s why it is a federal law to call 811 at least two business days before digging.

When the call is made, the homeowner or contractor is connected to the local one-call center, which notifies the appropriate utilities of their intent to dig. Professional locators are then sent to the requested site to mark the locations of underground lines with flags, spray paint or both.

National Energy Foundation Appoints AGA’s Lori Traweek as Board Chair

Salt Lake City, UT – National Energy Foundation (NEF) is pleased to announce Lori Traweek as the new chair of its Board of Directors. Lori Traweek is the senior vice president and chief operating officer of American Gas Association (AGA), which represents more than 200 local energy companies delivering natural gas to more than 68 million customers in the United States.

Barry Worthington, executive director of the United States Energy Association (USEA), has accepted a position as vice chair, a role previously held by Ms. Traweek. Additionally, Gary Swan and Wayne Bonner from NEF have accepted roles as secretary and treasurer. Bob Poulson will continue in his current capacity as president of NEF.

“I would like to thank both Lori and Barry for accepting new leadership roles on the NEF board of directors,” said Bob Poulson. “They are distinguished members of the energy industry and will bring a great deal of insight and expertise to our efforts. I am confident their leadership will continue to secure an enduring and prosperous future for the organization.”

Prior to her current responsibilities at AGA, Ms. Traweek was integrally involved in pipeline safety and environmental advocacy. Her involvement included serving on the executive steering team of the U.S. Department of Transportation’s Distribution Integrity Management Program initiative, and participating in the launch of the Common Ground Alliance, a collaborative organization with the goal of reducing excavation damage of underground facilities. Before joining AGA, Ms. Traweek worked as an offshore and onshore engineer for Arco Oil and Gas Co. in Texas and Louisiana. She holds a Bachelor of Science degree in mechanical engineering from Purdue University and a Bachelor of Science degree in communications from Ithaca College. Ms. Traweek serves on the Center for Energy Workforce Development Executive Council, the GTI board of directors and the International Gas Union USA presidency leadership team.

Mr. Worthington has written extensively on energy and environmental matters, and addresses many conferences on national and international energy issues. He holds a B.S. degree from Pennsylvania State University and an M.S. degree from the University of Houston. In addition to his roles with NEF and USEA, Mr. Worthington currently serves on the Boards of the U.S. – China Energy Environment Center, and the Energy & Mineral Law Foundation. He is also a member of the Advisory Boards of Electric Power Research Institute, the National Council of Minorities in Energy and the U.S. Environmental Protection Agency – National Advisory Council for Environmental Policy.