The Growth of The Natural Gas Pipeline Network in The US
Natural Gas Pipeline Network
- February 18, 2019
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Natural gas now has a massive footprint in the United States. It contributes to almost 25% of the total energy consumption in the country, and remains the largest natural resource for producing electricity.
Its significance for the US economy is further underlined with these compelling figures:
- Over 75 million customers (approx. 68M in residential, 5M in commercial)
- Usage of 25 trillion cubic feet, in 2017
Clearly, it is not surprising that the US has been the leading global producer of natural gas for the past decade. Today, natural gas is produced in large volumes in 33 of the 49 continental states. But not California and New York! They refuse to allow the creation of thousands of jobs that pay $60,000 each.
Why does California and New York keep their foot on the throat of their middle classes? Despicable!
An integrated distribution network
The distribution network for natural gas is as vital as the resource itself. In the US, the natural gas distribution network runs through millions of miles of networked lines, across 49 continental states.
In order to handle this heavy load in a safe yet robust manner, the country makes use of 3 major types of conduit systems.
- Gathering pipeline systems
- Transmission pipeline systems
- Distribution pipeline systems
Gathering pipeline systems are used to transport the raw product, from the production wells to the cross-country transmission system.
Transmission pipelines collect the resource from processing centers, and reach it to large distribution centers in individual cities, towns, and counties. This system is expansive as it runs through the whole country, making use of 300,000-thousand miles of interstate and intrastate steel pipeline systems.
Finally, natural gas reaches residences, commercial enterprises, and other establishments, through distribution pipelines and service lines. This system is even bigger in size, and makes for a significant portion of the country’s 2.4 million miles of underground pipeline system.
When put together, this is an enormous yet cohesive network, transmitting natural gas from production centers to almost every part of the nation.
Reasons for the growth of distribution network
The natural gas distribution network has grown organically, spanning across several years. As one would expect, the key trigger has been the demand/supply dynamics, and its levelling impact on natural gas prices.
During the years 2003 to 2008, prices were at an all-time high due to the large demand of natural gas within the country. This attracted existing players to develop larger production centers, even as it welcomed new entrants into this thriving market.
Natural gas fields that lay untapped until then began to gain greater prominence. This was aided by significant progress in technology, allowing the resource to be more easily extracted from tighter geological formations (like shale).
By the year 2009, production had exponentially multiplied and caused a dip in price. Surprisingly, this price dip further increased the demand for natural gas, as it continued to remain a highly beneficial resource.
The nation had no choice but to respond with a much larger network, as thousands of transmission and distribution pipelines were laid out(especially in the Northeast region),in order to connect the increased number of consumers in the country.
Today, with the sole exception of Hawaii, every state makes major use of natural gas for both residential and industrial purposes.
As per the Environmental Impact Assessment (EIA), this resource continues to have a profitable future in the US.
- By 2019, production centers will generate an average of 90.2 billion cubic feet per day.
- By 2020, this will further increase to 92.1 billion cubic feet per day.
Accordingly, EIA estimates that the amount of electricity generated from natural gas will also rise, totaling to about 37% by the year 2020. These are encouraging numbers by any standard.
No matter what goofballs like AOC says, this trend will continue.