Transcript Slide 1
National and State Trends for Natural Gas and Electricity Prices Talina R. Mathews Department for Energy Development and Independence Electricity • EIA forecasts that the average retail price of electricity across the US (adjusted for inflation) will remain nearly constant through 2035 • There are key uncertainties when extrapolating this forecast to KY average retail electricity rates • Age of plants • Portfolio mix • Environmental regulations (even without GHG discussion) US Electric Power Industry Net Generation, 2009 EPA actions will dramatically impact the future viability of coal generation Ozone SO /NO CAIR Water 2 2 Beginning SO2 Primary Revised CAIR Phase I ReconsideredNAAQS Effluent Guidelines Proposed Ozone Seasonal Ozone Final rule expected Transport Rule NAAQS NOx Cap NAAQS Next Ozone Final Transport SO2/NO2 Secondary NAAQS Revision Rule Expected CAIR NAAQS Vacated 316(b) Compliance Effluent 316(b) final rule 3-4 yrs after final rule Guidelines expected CAIR NO2 CO2 proposed rule Remanded Primary Regulation expected NAAQS '08 '09 PM-2.5 SIPs dueBegin (‘97) CAIR Phase I CAMR & Annual Delisting NOx Cap Rule vacated Source: EPA/EEI/AEP '10 Begin CAIR Phase I Annual SO2 Cap '11 '12 '13 PM-2.5 SIPs due (‘06) Next PM2.5 NAAQS Revision Final Rule for CCRs HAPS MACT Mgmt HAPs MACT final rule Proposed expected proposed Rule for Final EPA rule CCRs Nonattainment Management 316(b) proposed Designations rule expected PM2.5 Ash '15 '14 New PM-2.5 NAAQS Designations Begin Compliance Requirements under Final CCR Rule (ground water monitoring, double monitors, closure, dry ash conversion) Effluent Guidelines Compliance 3-5 yrs after final rule '16 Beginning CAIR Phase II Annual SO2 & NOx Caps HAPS MACT Compliance with Compliance 3 yrs Transport Rule after final rule Hg/HAPS 8 CO2 '17 Beginning CAIR Phase II Seasonal NOx Cap 8 Natural Gas • EIA estimates are decrease in price then slow rise in natural gas price in residential sector through 2035 • Key uncertainties – How much will there be an increase in demand for natural gas generation of electricity because of increased environmental regulation of coal fired power plants? – Will the shale gas resource development be reduced by increased regulations? SHALE GAS RESOURCES Conclusion • Price trends at the state level for electricity and natural gas are not easily predicted due to massive uncertainties.