Energy

ENERGY: Moderate summer weather equals moderate prices

Times Board of Economists - update from Karl Stanley, NIPSCO vice president of commercial operations
2013-07-21T00:00:00Z 2013-12-18T16:23:23Z ENERGY: Moderate summer weather equals moderate pricesBy Keith Benman keith.benman@nwi.com, (219) 933-3326 nwitimes.com

Cooler than normal summer weather is helping to keep electric prices moderate in the short-term, while low natural gas prices are doing the same for the long-term outlook.

The low price of natural gas is a boon for consumers both summer and winter, because it is a key input for electric production during the warm months as well as the nation's most-used heating fuel in winter.

"It has really been extraordinarily quiet in the natural gas world compared to what we've seen in the past," said Karl Stanley, vice president of commercial operations at NIPSCO.

The last couple of months natural gas at trading hubs as stayed between $3.75 and $4 per million British thermal units, dropping even a bit lower than that range the last couple of weeks.

Even with many older coal-fired electric generating plants now being taken out of service because of environmental concerns, there appears to be sufficient supplies of electricity for the present, Stanley said.

One wild card in the mix will be the effect of any new regulations or legislation limiting the emissions of green house gases, with 68 percent of U.S. electricity generated from fossil fuels, according to the U.S. Energy Information Agency.

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