In 2015 Pennsylvania experienced strong development with respect to the energy sector – reduced carbon dioxide emissions, lower energy prices, major local natural gas production, and more.
Contact: Pamela A. Witmer
Commissioner of the Pennsylvania Public Utilities Commission
Pamela A. Witmer is a commissioner of the Pennsylvania Public Utility Commission.
When it comes to energy, 2015 has been a good year for Pennsylvania – and the future looks just as promising.
Marcellus Shale has led Pennsylvania to become the second-largest natural gas-producing state in the nation, behind only Texas, driving the Keystone State toward recognition as an energy hub.
Sitting atop the Marcellus Shale – one of the most abundant and lucrative shale reserves in the nation — has offered us numerous benefits. To name a few:
Lower energy prices. Not only for natural gas customers but also for electric customers. Prolific, efficient production has contributed to natural gas prices that are 38 percent lower than they were one year ago, and electricity prices are declining. PPL Electric Utilities’ Price-to-Compare dropped 17 percent Dec. 1, attributed to dropping wholesale prices, due to – you guessed it – lower gas prices.
An overall healthier economy. Not only have we seen jobs in the industry, but Pennsylvania also has made the switch from being a natural gas importer to a natural gas exporter. Pipelines are now being reconfigured to send gas to other regions, rather than to receive supply. This means that not only can Pennsylvanians directly benefit from our proximity to its natural gas supply, but our economy gets a boost from these exports. And as additional pipeline infrastructure is built, opportunities for in-state uses will increase.
Reduced carbon dioxide emissions. We are using 20 times more gas to generate electricity in Pennsylvania compared with 15 years ago. Natural gas is a much cleaner-burning fuel, and carbon dioxide emissions within the electric grid serving Pennsylvania, New Jersey, and Maryland have steadily declined – down by about 23 percent since 2005.
Marcellus Shale sources the majority of the gas delivered by Pennsylvania’s major gas utilities. It accounts for 90 percent of UGI’s product, 85 percent of Peco’s supply, 61 percent for Columbia Gas, and 50 percent for Peoples Natural Gas.
Thanks to Marcellus Shale, for the first time in more than 50 years, in 2013 the PUC approved a new natural gas utility. Leatherstocking Gas Co. now allows residents in Susquehanna County and surrounding areas to take advantage of natural gas cost savings and environmental benefits. Leatherstocking’s goal is to exclusively use Marcellus Shale gas. I recently participated in an event in Susquehanna County to highlight success stories like Leatherstocking – and similar stories are being repeated across Pennsylvania.
With so much gas – and gas byproducts such as propane – available, we need more infrastructure to deliver it. Limits in pipeline capacity are an issue, underlining the importance of projects like the Mariner East pipeline, which helped to deliver much-needed propane to Pennsylvanians during sustained cold and peak demand last winter.
Likewise, there are Pennsylvania residents who currently do not have access to this resource because they are not near pipelines. It can be expensive for residents and businesses to connect, with “extension costs” in the tens of thousands of dollars when paid up front.
Increasing access and affordability across the state is a priority at the PUC, and we have pushed utilities to design innovative programs for consumers to manage these costs. The majority of our major natural gas utilities have now implemented aggressive pilot programs aimed at cost-effective ways of extending service to unserved or underserved areas.
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