Climate Denial Crock of the Week

This chart seems like a handy explainer for one of the contributing factors to today’s high oil amd gas prices. https://t.co/AlUop48iEx

— Michael E. Webber (@MichaelEWebber) October 19, 2021

Just like computer chips, fossil gas is slow getting ramped up after the COVID plunge.
The longer term market response is that clean energy becomes more competitive.

The short term market response is that generators in the US, China and Europe are using more coal.

Wall Street Journal:

Americans got a stark warning from the government this week: Expect higher heating bills this winter.

According to the Energy Information Administration, nearly half of U.S. households that warm their homes with mainly natural gas can expect to spend an average of 30% more on their bills compared with last year. The agency added that bills would be 50% higher if the winter is 10% colder than average and 22% higher if the winter is 10% warmer than average.

The forecast rise in costs, according to the report, will result in an average natural-gas home-heating bill of $746 from Oct. 1 to March 31, compared with about $573 during the same period last year.

The forecast is part of the EIA’s winter fuels outlook, which projects that U.S. households will spend more on energy this winter than they have in several years. The agency attributed its forecast to rising energy prices—natural-gas futures have this year reached a seven-year high—and the likelihood of a more frigid winter than what most of the country saw last year.

The looming increase, on top of rising prices for many consumer goods and commodities, is likely to cause stress for Americans at many income levels. Economists warn that the larger utility bills are most likely to affect those households still hobbled by the Covid-19 pandemic.

Wall Street Journal:

Will the U.S. run out of gas this winter?

The answer is almost certainly “no,” but the rest of the world might not be so fortunate. Now that the U.S. has become a major liquefied natural gas exporter, it can play a big role in making sure other countries have enough. Or it can keep some of that gas at home if domestic natural gas prices, already at their highest since the 2014 polar vortex, spike further. 

If it did so, the ensuing tussle could get nasty, denting America’s reputation as a reliable supplier. Almost a decade ago, long before the U.S. became a major LNG exporter, industrial users—including Dow Chemical and steelmaker Nucor—pre-emptively called for export curbs to make sure domestic users had access to cheap and abundant gas. Suppliers countered, saying that the U.S. could pump the commodity rapidly enough to meet both export and domestic demand.

A cold winter could challenge the suppliers’ assumption. With domestic inventory below five-year average levels, U.S. benchmark gas prices have already doubled from a year earlier, recently nearing $6 per million British thermal units.

That is nothing compared with East Asia and Europe, where prices are about five times as high well before the first snowflake. The supply crunch comes at a time when the U.S. is exporting more natural gas—supercooled and liquefied to be carried to destinations abroad—than ever before. If supplies merely get stretched domestically then U.S. customers might need to pay a similarly shocking sticker price. Making matters worse, U.S. natural gas producers are in no rush to drill for more gas after getting burned by previous sprees that left them saddled with debt. Coal, which can step in to replace natural gas for power generation, is also in short supply.

Grumbling is already starting. Two weeks ago, a trade group representing manufacturers sent a letter to Energy Secretary Jennifer Granholm urging “immediate action” to reduce LNG exports, saying manufacturers can no longer compete in the market if natural gas prices surge. That dynamic has already played out in Europe, where soaring energy prices have prompted some steelmakers and fertilizer plants to halt production. An LNG industry group countered with a letter asking Secretary Granholm for continued support on LNG permits and approvals, saying that exports stabilize and incentivize U.S. production.

”US power companies are ramping up their coal consumption due to surging natural gas prices.
US coal-fired generation is expected to surge by 22% in 2021”https://t.co/mAyRXi8rXQ

— Greta Thunberg (@GretaThunberg) October 19, 2021