Appalachian Basin

New York State Bets Big on Natural Gas

The state of New York recently released its draft 2014 energy plan, which calls for the increased use of natural gas despite an almost six year moratorium on shale gas development within the state.  According to the plan:

“The Department of Public Service is to encourage and support oil-to gas- conversions by collaborating with other state agencies and regulated gas utilities to accelerate investments in natural gas distribution.”

NYS Gas Consumption

The graph above shows New York’s forecast for natural gas use for the next 20 years, increasing year over year. In fact, according to the energy plan, the demand for natural gas in electricity generation is expected to grow from 7.5 trillion cubic feet (Tcf), a 24 percent share in 2011, to nine Tcf (27 percent share) in 2035.

The state’s energy plan also explicitly recognizes the benefits of using more natural gas:

“Since natural gas is cleaner than other fossil fuels used for home heating, and under current market conditions costs a third as much, and since New York is well-located geographically to take advantage of existing and newly developed lower cost natural gas supplies located outside the State.”

Given all the benefits we’ve seen from shale development and increased use of natural gas, both economic and environmental, one would think environmentalists would be happy about the readily available natural gas being produced by their neighbors to the south in Pennsylvania.  Instead, the energy plan was criticized by activists for its reliance on natural gas, which they claim will lead to an increase in greenhouse gas emissions.

But saying natural gas doesn’t reduce greenhouse gases (GHG) is objectively false and completely disregards the facts.  New York City, which is transitioning to natural gas as a heating source in many of its buildings, now has the cleanest air it has seen in 50 years. Recent EPA data even show a notable decrease in methane emissions from natural gas systems between 2011 and 2012.

Other points worth noting in the New York State draft energy plan:

  • New York has approximately 4.7 million natural gas customers served by eleven local gas distribution companies.” (p. 67)
  • “Production of natural gas from wells in New York dates back to 1821 when the first commercial natural gas well in the U.S. was drilled in Fredonia. Currently, there are approximately 6,800 active natural gas wells in the State.” (p. 83)
  • “In 2010, New York used approximately 1,198 Bcf of natural gas20, making it the fourth largest gas consuming state in the nation.” (p. 93)
  • “Approximately 97 percent of the natural gas supply required to meet the demands of New York natural gas customers is from natural gas supply production regions in other states. In the past these regions principally included the Gulf Coast and Canada. Today the mix includes supplies from the West and a growing proportion from the Marcellus Shale.” (p. 83)
  • “From 2012 through 2030, total primary energy use is projected to increase by 198 TBtu, or an average annual rate of 0.3 percent. Over this period, natural gas use is projected to increase by 257 TBtu, or an average annual rate of 1.1 percent.” (p. 21)

It’s clear that New York is betting heavily on natural gas as an energy source for the near future, and why wouldn’t they? The Marcellus Shale has vast proven reserves, and Pennsylvanians are happy to provide New Yorkers with affordable, clean, and abundant energy that creates high paying jobs and allows money to flow into their local municipalities.  Hopefully, someday, New York’s Southern Tier will be able to experience these benefits and provide the energy its state is relying on for the future.


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