EIA: U.S. Gas Consumption to Rise 5.1 Percent in 2012

The U.S. Energy Information Administration (EIA) said in a report that U.S. natural gas consumption will average 70.2 billion cubic feet per day (Bcf/d) in 2012, an increase of 3.4 Bcf/d (5.1 percent) from 2011 and an upward revision of 0.6 Bcf/d from last month’s Outlook.

EIA expects that large gains in electric power use will offset declines in residential and commercial use. Because of the much-warmer-than-normal winter this year, EIA expects both residential and commercial consumption to fall by over 6 percent in 2012, reflecting a downward revision in projected consumption from last month’s Outlook. The downward revisions in residential and commercial consumption reflect the decline in total projected 2012 heating degree-days as reported by the National Oceanic and Atmospheric Administration.

Projected consumption of natural gas in the electric power sector grows by almost 21 percent in 2012, primarily driven by the increasing relative cost advantages of natural gas over coal for power generation in some regions. Consumption in the electric power sector peaks in the third quarter of 2012, at 31.2 Bcf/d, when electricity demand for air conditioning is highest. This compares with 27.7 Bcf/d during the third quarter of 2011.

Growth in total natural gas consumption slows in 2013, with forecast consumption averaging 71.2 Bcf/d (U.S. Natural Gas Consumption Chart). However, unlike 2012, growth in 2013 is driven by consumption from the residential, commercial, and industrial sectors. A forecast of closer-to-normal winter temperatures drives increases in residential and commercial consumption in 2013 of 7.1 percent and 4.2 percent, respectively. The increase in consumption in these sectors, as well as a 1.4-percent increase in industrial consumption, more than offsets a 2.0-percent decline in power-sector natural gas burn.

Liquefied natural gas (LNG) imports are expected to fall by 0.3 Bcf/d (32 percent) in 2012. EIA expects that an average of about 0.7 Bcf/d will arrive in the United States (mainly at the Everett LNG terminal in New England and the Elba Island terminal in Georgia) in both 2012 and 2013, either to fulfill long-term contract obligations or to take advantage of temporarily high local prices due to cold snaps and disruptions.

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LNG World News Staff, May 9, 2012; Image: EIA