Natural gas and electricity prices?

[HeatherC]

So we just learned our local electric company (National Grid) will be raising prices by 64% here in Massachusetts due to the increase in Natural gas prices used to make the electricity.

My confusion or rather frustration is that we are the world’s biggest producer of natural gas with 32 states producing it. I totally understand world markets affecting things along with the war in Ukraine etc.. Why, however, if we are producing it here in the US are the prices for us so high? I can understand it being higher for other countries to import it, but we produce it. Shouldn’t we be getting a better rate for it? Kind of along the same lines of oil being cheaper for those in Saudi Arabia, etc..

What am I missing?

 

[TwoMisfits]

So we just learned our local electric company (National Grid) will be raising prices by 64% here in Massachusetts due to the increase in Natural gas prices used to make the electricity.

My confusion or rather frustration is that we are the world’s biggest producer of natural gas with 32 states producing it. I totally understand world markets affecting things along with the war in Ukraine etc.. Why, however, if we are producing it here in the US are the prices for us so high? I can understand it being higher for other countries to import it, but we produce it. Shouldn’t we be getting a better rate for it? Kind of along the same lines of oil being cheaper for those in Saudi Arabia, etc..

What am I missing?

There's an answer...but it's gonna lead to stuff not allowed to be discussed on the boards.

Although one thing that can be discussed - the large increase in our natural gas exports in 2022, especially vs 2021.

 

[tvguy]

Although one thing that can be discussed - the large increase in our natural gas exports in 2022, especially vs 2021.

That certainly is the case here in California with our agricultural exports. Asparagus, for example. It is grown 40 miles from my house, but the price has risen because Japan will buy all the asparagus we can grow and they pay a premium price.

 

[leebee]

Basic capitalism, as in sales of product go to those willing to pay the highest prices?

 

[cvjw]

Can’t be discussed here. Do some research. The answer is very obvious once you look into it.

 

[kdonnel]

My rates have been stable and my budget billing has actually gone down $15 a month for my electricity, a 6% reduction.

 

[MICKIMINI]

NH here. Our electricity went up 112% last month (not a typo). Our fuel oil went up from $1200 a year to $2000 for 2022-2023. Sickening. I will withhold my facts as OP indicated we can't discuss here...

Edit to mention it gets to -20 here. We don't have a choice.

 

[adkkev]

From a reliable news source …
“But the bigger issue for US natural gas is the fact that inventory levels are below historical averages, leaving the market with less of a buffer and driving up prices.
"We entered this year at beaten-down levels and we never caught up," Yawger said.
Supply has failed to keep up with strong demand for gas. Thummel pointed to how US oil and gas producers are under pressure from Wall Street to spend less on expensive drilling projects and more on dividends and buybacks to shareholders.
"We need more US natural gas production. The production levels are too low," Thummel said.
The good news is that higher prices should, eventually, incentivize more production. And investors are not betting today's high prices will continue. The futures market indicates natural gas prices should be almost 50% lower at this point next year.”

Along with increased exports to Europe to help them cope with their loss of supply.

 

[Neapolitan Ice Cream]

New Scientist wacko here!

In our lifetimes, energy costs will plummet. Three new sources are being tapped with MASSIVE potential that isn't reliant on Russia or the Arab States.

• Orbital Power - Still quite a way off. Orbital satellites capture solar radiation and beam it down to earth in radiation. No cloudy days that currently blights our solar arrays.
• Nuclear Fusion - The holy grail! If we can get a self sustaining fusion reaction in place, we will have netted a clean, infinite, massive source of power. No more nuclear waster, no more fuels, very few plants needed. In the past, we've only been able to initiate fusion reactions by putting more energy in than we got out in order to sustain the reaction. Now we have successfully initialed a self sustaining, energy producing reaction that lasted an impressive 30 seconds ON ITS OWN. Doesn't sound like much, but in physics terms, this is nothing short of a miracle and a tremendous leap in technology. I dare say that we may well see Fusion Power being introduced in our lifetimes! Bear in mind just how MUCH power this takes and how much it produces - I believe I'm right in saying that the temperature in the core surpassed that of the surface of the sun? Over 100 million °C? I personally can't wait.
• Quantum Batteries - batteries used to store renewable power can be messy to create, maintain, take time to charge and fail over time. New, quantum state batteries go from nil to 95% charge in hardly any time at all, are easy to make and take up very little resources to produce and maintain. This makes renewables far more practical, as when we have excess solar or wind, the surplus energy can easily and viably be stored for use when the environment is less giving. Probably the most production ready technology of the three. Couple this with electric cars and trains that charge big, store big and are kinder to the environment, and pollution can be tackled far more easily.

No one idea will be the be all and end all solution, but you never know what's round the corner...

 

[tvguy]

CBS news did a story tonight on bans on natural gas. Nice balanced story. https://www.cbsnews.com/live/video/...anet-warming-emissions/?intcid=CNM-00-10abd1h

 

[HeatherC]

NH here. Our electricity went up 112% last month (not a typo). Our fuel oil went up from $1200 a year to $2000 for 2022-2023. Sickening. I will withhold my facts as OP indicated we can't discuss here...

Edit to mention it gets to -20 here. We don't have a choice.

I feel your pain. I honestly feel so bad for those who are not able to absorb these increases this Winter. Like you said, there is no choice. Plus, you can’t keep the heat super low or pipes freeze and that is another nightmare to deal with.

We are lucky to have two wood pellet stoves (but they require electricity) along with a propane fireplace as backup heat sources. But at this point, we are really regretting not having a wood burning fireplace.

At the very least, they should eliminate any taxes on home heating fuels for this season. But that won’t happen.

 

[MICKIMINI]

New Scientist wacko here!

In our lifetimes, energy costs will plummet. Three new sources are being tapped with MASSIVE potential that isn't reliant on Russia or the Arab States.

• Orbital Power - Still quite a way off. Orbital satellites capture solar radiation and beam it down to earth in radiation. No cloudy days that currently blights our solar arrays.
• Nuclear Fusion - The holy grail! If we can get a self sustaining fusion reaction in place, we will have netted a clean, infinite, massive source of power. No more nuclear waster, no more fuels, very few plants needed. In the past, we've only been able to initiate fusion reactions by putting more energy in than we got out in order to sustain the reaction. Now we have successfully initialed a self sustaining, energy producing reaction that lasted an impressive 30 seconds ON ITS OWN. Doesn't sound like much, but in physics terms, this is nothing short of a miracle and a tremendous leap in technology. I dare say that we may well see Fusion Power being introduced in our lifetimes! Bear in mind just how MUCH power this takes and how much it produces - I believe I'm right in saying that the temperature in the core surpassed that of the surface of the sun? Over 100 million °C? I personally can't wait.
• Quantum Batteries - batteries used to store renewable power can be messy to create, maintain, take time to charge and fail over time. New, quantum state batteries go from nil to 95% charge in hardly any time at all, are easy to make and take up very little resources to produce and maintain. This makes renewables far more practical, as when we have excess solar or wind, the surplus energy can easily and viably be stored for use when the environment is less giving. Probably the most production ready technology of the three. Couple this with electric cars and trains that charge big, store big and are kinder to the environment, and pollution can be tackled far more easily.

No one idea will be the be all and end all solution, but you never know what's round the corner...

We will freeze way before we round that corner...

 

[MICKIMINI]

I feel your pain. I honestly feel so bad for those who are not able to absorb these increases this Winter. Like you said, there is no choice. Plus, you can’t keep the heat super low or pipes freeze and that is another nightmare to deal with.

We are lucky to have two wood pellet stoves (but they require electricity) along with a propane fireplace as backup heat sources. But at this point, we are really regretting not having a wood burning fireplace.

At the very least, they should eliminate any taxes on home heating fuels for this season. But that won’t happen.

We downsized seven years ago from a large house and a woodlot. We burned wood and had a pellet stove and fuel oil. We managed to cut our fuel consumption by about 40%, but it is constant work all year (felling, cutting, stacking, splitting) to keep a wood stove roaring. Heading for retirement we bought a 25% smaller house and rely on fuel only. We only use 400 gallons a year which is less than we used at our other house even with wood sources. I buy fuel once a year in the spring at a lower price.

I'm really not into going back to where my grandmother was in the late 1890's before electricity, telephones and cars. Outhouses were the rage. Most people in rural areas lived a subsistence lifestyle including having a garden, chickens, a cow or two including processing all their natural products (putting up vegies in the cellar) and bartering with neighbors. Staying warm and having food was a necessary obsession. Working 18 hours a day to survive was common. Living to 65 was a miracle.

The entire population of the northern part of the country will be moving south if we don't have a way to heat our homes and HeatherC is right that without heat our pipes freeze and house destroyed and unlivable. Nobody in 2022 wants to live in the stone age. It's scary!

 

[jalapeno_pretzel]

Why, however, if we are producing it here in the US are the prices for us so high? I can understand it being higher for other countries to import it, but we produce it. Shouldn’t we be getting a better rate for it?

I think it's maybe a misconception that the gas/oil produced here is somehow 'our' resource. It belongs to Exxon, BP, or whatever company has leased drilling rights from the USA's public lands. It's a fungible commodity sold on a global market. The corporation that owns the oil answers to their shareholders, not to the general public, and it's in the shareholder's interest to get the best price possible for their product.

 

[dvcgirl67]

Well, I think it's more complicated than just thinking....we should just keep all of our oil. We export a lot of oil...around 8 million barrels a day. And there are different types of crude oil....and so depending on the type....we may not need it, but other nations will buy it. It's a global market. As for natural gas, every European country is scouring the earth buying up as much supply as they can get their hands on because of the war between Ukraine and Russia. So that will drive up prices as well. In NJ, I know our natural gas supplier got an approval to raise prices by 25%, which would take bills up by $258 annually. The kind of crappy silver lining in all of this....is it's looking like we're heading for a global recession. There won't be a "soft landing" for the economy. And so prices will come down....but not in a way that anyone likes to see.

 

[MICKIMINI]

I think it's maybe a misconception that the gas/oil produced here is somehow 'our' resource. It belongs to Exxon, BP, or whatever company has leased drilling rights from the USA's public lands. It's a fungible commodity sold on a global market. The corporation that owns the oil answers to their shareholders, not to the general public, and it's in the shareholder's interest to get the best price possible for their product.

You are correct, however those companies need *permission* and access to *bank loans* (like any other regulated business) otherwise no can do. We are at no can do and it is unlikely we'll see relief anytime soon as no one has the guts to admit the emperor has no clothes.

Let's hope those companies can maintain their facilities and afford to keep their skilled engineers and employees even though they can't produce enough. You would think covid taught us lessons on letting skilled workers go (like commercial pilots).

 

[SandyinMonterey]

Just heard on our local news station that we can expect a 17% increase this year. On average they figure families paying $1300/year more and for those with oil paying over $2000/year more.

 

[MICKIMINI]

Just heard on our local news station that we can expect a 17% increase this year. On average they figure families paying $1300/year more and for those with oil paying over $2000/year more.

It must be *new math* as we went from $1200 a year to $2000 a year (I buy in May). $1200 x .17 = $1404. Numbers don't lie which makes those newsies look, well, like they failed Math 101.

I don't know where you live, but in NH we're up about 65% (so far)!

 

[shh]

The entire population of the northern part of the country will be moving south if we don't have a way to heat our homes

Not to minimize your serious issues or financial pain, but trust me, living in the south is no picnic either. Our rates have skyrocketed and 24/7 AC is not a luxury - it's a necessity - kind of like heat during winter for you. Power outages of 1-2+ weeks after a storm means you're living 24/7 in 100+ degree feel like temps in brutal, sticky humidity with no way to cool off. Sadly, many heat related deaths occur after prolonged power outages.

 

[MillauFr]

You are correct, however those companies need *permission* and access to *bank loans* (like any other regulated business) otherwise no can do. We are at no can do and it is unlikely we'll see relief anytime soon as no one has the guts to admit the emperor has no clothes.

Let's hope those companies can maintain their facilities and afford to keep their skilled engineers and employees even though they can't produce enough. You would think covid taught us lessons on letting skilled workers go (like commercial pilots).

Seriously? Permission? As the saying goes when politicians are regulating the buying and selling of goods the first things to be bought and sold are the politicians. Wall St. calls the shots not anyone in Washington DC.