Viewing a single comment thread. View all comments

safetysmitty3990 t1_j5tc9tu wrote

Reply to comment by SobeysBags in Remind us again why CMP is doubling and worse our electric bills? by easy_peasy_woeisme

Here's an article I spent 5 seconds searching for on Google: https://www.naturalgasintel.com/haynesville-output-to-top-16-bcf-d-as-total-lower-48-production-continues-to-climb/

They talk about exactly the same phenomenon I am and even had a nice graph. I'm actually surprised you 'haven't been able to find any evidence' since it's all over search 'new england natural gas basis'.

1

SobeysBags t1_j5tmeoj wrote

ok, I guess I am not being clear enough, I apologize if that is the case. I am not debating about 2022 or pervious gas prices, I know those are high. I am saying the price is dropping right now, as we speak, currently, in the present. However the price for the standard is locked in from 2021/2022. So as the price falls for natural gas across the board, right now, Mainers will be stuck with one of the highest electricity rates they have had until the standard offer is renegotiated for 2024 (unless natural gas should increase again in 2023 , who knows with world events). Sheesh.

1

safetysmitty3990 t1_j5ue6gb wrote

I'm sorry for being dismissive. I understand your question and I haven't done a good job getting my point across. There are NYMEX natural gas futures contracts that are falling, but you also need the basis piece (the cost of moving the physical gas molecules through pipelines) to get a complete price. So delivered wholesale gas is gas futures + basis futures. Even when gas futures fall, basis futures have remained elevated. I've been trying to find a source but basis futures priced are not available for free (you'd need a Bloomberg Machine or ICE subscription). Here is an article that has a graph of pricing for the 23-24 winter season: https://www.nrg.com/insights/energy-education/purchasing-strategies-for-new-england-market-dynamics.html

Bottom line is when you see the headlines that gas prices are falling, it's not reflective of what the real delivered price is in New England.

1