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The 1998 Gas Industry Executives Forum Mapping the Universe of Natural Gas: Closed, Shrinking or Expanding?

Fortnightly Magazine - May 1 1998

there are significant advances in information technology: electronic bulletin boards, posting and dispatching of natural gas on an intra-day basis, utilities providing customer billing information interactively on the Internet [and] company intranet sites to keep employees up-to-date on corporate activities. In California, a Web site allows customers to request and receive gas supply proposals from marketers. The speed at which all of this information is becoming available is going to contribute to a faster market and a more competitive one.

Gains in technology continue in other areas: ultrasonic metering, advances in trenchless technology [and] improvements in plastic pipe and leak-detection.

Also, there's going to be a very strong emphasis on natural gas R&D. Thanks in part to the current administration's commitment to cutting emissions in line with global climate change initiatives. Research opportunities include natural gas combustion systems, natural gas cooling [and] natural gas vehicles and fuel cells. All of which will grow demand for natural gas, increase energy efficiency and reduce air emissions.

Ruth K. Kretschmer, chairman, Gas Committee, National Association of Regulatory Utility Commissioners, and member, Illinois Commerce Commission

ELECTRIC DEREGULATION. I think almost everyone in the industry agrees it will impact it very greatly. We see more and more companies talking about energy as one unit, and not as separate gas and electricity. I predict that you will find that even residential customers will deal with one energy company rather than two. That isn't going to happen for a couple of years, but I think it will happen.

HOURLY PRICING. The industries are going to have to accommodate each other. If the electricity industry is going to use more gas-fired generation, they will have to make some accommodations. I'm not sure they need 15-minute pricing, or half-hour pricing, so I would believe that they would use a longer pricing period and the gas industry will have to work toward accommodating that. I do think that new metering technology will be needed by both the gas and electric industries and there will be a meeting of the minds, so to speak, as to what exactly is necessary and what can be done¼ based on past usage.

CONSUMER SAVINGS? This past summer our legislature asked us to have a gas conference to talk about broad-scale issues in the natural gas industry. We had regulators, legislators, pipelines, and marketers and LDCs participating. And I could not get a definitive answer from anybody on whether there were real savings. What I was told was, don't look at percentages, don't say, "We can offer a 10 percent discount."

I do not envision great savings. There may be some, but I think that if the public is pushing for choice (em and you can get an argument there (em I think they may be disappointed to see that the savings are not what they anticipated. You know, there's still a great deal of discussion in the public about whether they're getting enough savings on the telecommunications side to justify what many see as an upheaval of reliable service. Five years from now¼ are they going