MISO predicts continued natural gas demand within its footprint

The Midcontinent Independent System Operator (MISO) released results of its analysis of natural gas infrastructure, which predicts continued increases in gas demand from the power generation sector throughout the MISO service footprint

The continuing demand for gas in MISO's footprint is driven by an aging power generation fleet, low gas prices and environmental regulations, according to the study.

"Over the past two years, growth in shale gas production has dramatically altered the natural gas supply landscape," said John Lawhorn, Senior Director of Policy and Economic Studies at MISO. The Phase III study highlights the impacts of this paradigm shift, including the transition of the Midwest from being a by-way to a destination for gas sourced from an increasingly diverse supply portfolio. The analysis also forecasts continued access to numerous gas supply sources for end users in MISO South, due to an exceptionally well-connected pipeline network there.

MISO notes that these positive trends do not alleviate near-term electric generation capacity concerns. "Improved gas supply and transportation does not automatically translate to an increase in gas-fired capacity in the MISO footprint; uncertainty surrounding commitments to build new capacity continues to persist," Lawhorn said. Furthermore, investment is still needed to address existing area-specific constraints on Midwestern gas pipelines. The report goes on to say that increasing reliance upon Northeastern gas imports will require new or expanded infrastructure into the Midwest.

MISO plans to work with its stakeholders, state and federal regulators, and the natural gas industry to address the report's conclusions. The RTO also remains engaged on many fronts with efforts aimed at improving inter-industry coordination. The Electric and Natural Gas Coordination Task Force, a MISO stakeholder forum established in late 2012, continues to provide a forum for exploring opportunities and addressing issues.

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