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Cold weather led to increased demand for natural gas

by Wyoming Livestock Roundup


Colder temperatures this winter in the United States led to increased demand for natural gas from the electric power sector, as more natural gas-fired generation was needed to heat homes and businesses. From November 1, 2013, to March 18, 2014, daily temperatures in the 48 contiguous states averaged 41 degrees Fahrenheit, 7% colder than the same period last winter, according to data from Bentek Energy. Average power burn through March 18 rose by 2% over last winter’s level, from 19.5 billion cubic feet per day (Bcf/d) to 19.9 Bcf/d.


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However, while temperatures declined almost uniformly throughout the 48 contiguous states, there was no uniformity for the increase in power burn. Colder temperatures increased the demand for natural gas across all sectors, but the accompanying record-high natural gas storage withdrawals and higher prices also placed counterbalancing downward pressure on power burn. This was particularly true in the eastern United States, where as a result of periods of sustained higher prices, average power burn declined compared with last winter. To a lesser degree, natural gas prices rose in the central and western United States. However, despite the year-over-year price increases, power burn grew in these regions, driving the entire 48 contiguous states’ increase.


Decreased power burn in the eastern United States In the Northeast and Southeast (shown in map above), electric sector consumption of natural gas declined by a combined 0.6 Bcf/d this winter, 6% below last winter’s power burn for these regions through March 18. 

Increased power burn in the central and western United States While higher natural gas prices likely limited the amount that natural gas power burn rose in response to colder temperatures this winter in the central and western United States, their impact on power burn was not as pronounced as in the Northeast and Southeast. Power burn in the central and western regions rose by 1.1 Bcf/d, or 12%, through March 18, 2014 over last winter’s levels, driving the entire Lower 48 increase in power burn. 


Click to view more summary data

– Article from Drover Cattle Network

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