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Utilities Must Step Away from Natural Gas If They're to Keep the Lights on, Says Thinking Energy's Latest Report
Monday October 31, 10:00 am ET

FALMOUTH, Maine--(BUSINESS WIRE)--Oct. 31, 2005--Natural gas supply forecasts for this winter in North America are dire, with some regional ISOs predicting rolling blackouts. Is this just a short-term crisis or will it continue to impact power companies' ability to perform for years to come? The crisis will be long term, advises Thinking Energy. In its latest report, Natural Gas in Crisis: How Power Companies Can Keep The Lights On, Thinking Energy's Peter R. Savage says, "This is the year when the follies of the past two decades will be paid for, in full."

Natural Gas in Crisis examines the roots of the current natural gas crisis in North America, discussing its commercial, technological, political and environmental causes. Touted as the 'clean and inexpensive' fossil fuel, natural gas has tripled in cost over the past months as supply has been severely affected. Natural gas demand, which has risen rapidly over the past few years, is expected to skyrocket as the coal-fired power plants in Ontario, Canada are shut down and foolishly replaced by natural gas. This short-sighted move is sure to roil the North American energy markets further. Further, US production isn't able to keep up with current demand. Although exploration and production technology is improving and alternative sources for natural gas are being researched, these efforts won't yield enough supply to keep power plants running. LNG imports are being bandied about as the panacea to today's problem. This foolhardy strategy will only serve to make the US electricity industry dependent on supplies from overseas countries, many of them members of OPEC.

What can power companies do to keep the lights on? "Baseload electricity demand must shift from natural gas to clean coal, nuclear and hydro," says Savage. "Wind, the only renewable with tolerable economics at the moment, can supplement. Natural gas, if used at all, should be used only for peaking units," he says.

The Thinking Companies has held a consistent position about major issues confronting electrical power in its series of management reports over the past half-decade. It has critiqued and offered remedies to the risk management aspects of the business, correctly noted the return of 'clean coal' to the arena, examined the emerging folly of one particular 'anti-coal' policy - in Ontario - and debunked the shabby economics and technology of many 'renewable energy' sources. At each stage, often alone among consulting companies, it has strongly warned against overdependence on 'plentiful, cheap' natural gas.

Source: The Thinking Companies, Inc

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