By February 28, 2018 0 Comments Read More →

Natural Gas Power Plants Purchase Fuel Using Different Types of Contracts

Most natural gas-fired power plants in the continental United States fulfill all of their fuel requirements through firm contracts that obligate the natural gas producer and the pipeline operator to send the natural gas to the power plant when requested. These power plants reported receiving 71% of the natural gas purchased by power plants in 2016.

About 16% of natural gas used for power generation in 2016 was purchased by plants that reported using only interruptible contracts, in which the natural gas supplier or pipeline operator has the option of interrupting the fuel supply for contractually stipulated reasons. The remaining 13% of natural gas was purchased by plants through some mix of firm and interruptible contracts throughout the year.

The electric power sector, which surpassed the industrial sector in 2008 and the combined residential and commercial sectors in 2015, has become the largest consumer of natural gas in the United States. As the share of natural gas used for power generation has increased, so has the interdependence between natural gas supply and infrastructure and electric power generator operations…


Click Here For Remainder of Article 

Posted in: Opinion

About the Author:

Post a Comment