Americans See Huge Savings from Natural Gas Production
December 4, 2019
Energy in Depth recently featured a report by Shale Crescent USA and the Ohio Oil & Gas Energy Education Program that illustrated the outstanding benefits that American consumers are realizing from natural gas production – to the tune of more than $1.1 trillion in savings over the past 10 years.
The report corelated the growth in domestic natural gas production to more than $4,000 in savings per household (over a 10-year period) for those who use natural gas. This, in addition to billions of dollars saved by manufacturing end users in the Shale Crescent region of Ohio, Pennsylvania and West Virginia.
The increase in shale development has been the catalyst for this cost-savings, and includes substantial benefits across residential, commercial, industrial, and electric power sectors, according to the report.
Natural gas costs – which have fallen 65 percent from $8.86 per thousand cubic feet in 2008 to $3.08 last year – have a direct impact on almost all goods and services. When distributing the cumulative $1.1 trillion in savings to each of America’s 125 million households, the average annual savings equate to $900 per household per year, or $9,000 in savings since 2008.
The savings were even higher – $4,000 annually – in households that directly use natural gas. And for households in the lowest 20 percent of income, the realized savings equate to 2.7 percent of annual income, the data show. As Rhonda Reda, executive director of the Ohio Oil and Gas Energy Education Program told Oil and Gas Journal, getting a 2.7-percent boost in income is meaningful for these families.
Texas and other natural gas producing states along the Gulf Coast have historically provided most of the growth in natural gas supply. But since 2008 – as horizontal drilling and hydraulic fracturing were utilized to develop tight formations and shale across the country –the Shale Crescent region has realized the greatest amount of production growth. Ohio, Pennsylvania and West Virginia have increased their combined production 20-fold in the past decade, representing 85 percent of total U.S. natural gas growth in that time span.
The International Energy Agency projects petrochemicals will drive demand for oil and natural gas through 2040. Keeping the United States competitive and able to meet these growing demands is why the Department of Energy and groups like Shale Crescent USA continue to promote the viability of the region as a second petrochemical hub alongside the Gulf.
Read the full article on the Energy in Depth website.