Prices Steady, Natural Gas Supply Strong According to AGA’s Winter Heating Outlook
Washington – Natural gas customers should expect this winter’s heating bills to remain stable and relatively low, according to experts from the American Gas Association who today presented AGA’s annual Winter Heating Outlook. Natural gas storage levels remain near historic highs, providing significant cushion to maintain a reliable supply of natural gas throughout the winter.
AGA analysis finds that:
- Demand for natural gas is growing due to industrial re-onshoring, growing electric power requirements, increased demand for exports and new natural gas consumers. However, the natural gas market is set to be well-supplied headed into the 2024-2025 winter heating season.
- Commodity prices are lower and are now in line with historical natural gas pricing trends. Strong levels of natural gas in storage and steady natural gas production have contributed to a well-supplied market.
- Lower commodity prices have translated to lower natural gas consumer bills.
- New infrastructure – and the permitting reform to enable it – is needed to meet growing demand.
Despite increased demand and a winter projected to be 5% colder than last year, natural gas customers should see winter energy bills approximately the same as last year and 16% lower than two years ago when weather conditions were similar to what is expected in the 2024-2025 winter season. When accounting for the increased use of natural gas for households in colder climates, those households heating with natural gas are expected to save between 59% and 100% on their heating bills compared to all-electric homes this winter.
U.S. natural gas production and consumption both reached record highs in 2023, with 37.8 Tcf of natural gas produced, and 32.6 Tcf consumed. This record-breaking consumption was driven in significant part by the increasing importance of natural gas for power generation, where natural gas accounted for 43% of supply, providing more than twice as much peak generation as the next largest energy source.
“The natural gas delivery system is prepared to once again meet its obligations to consumers and ensure continued access to cost effective and reliable energy. At the same time, the role of natural gas is expanding and has unquestionably become the backbone of our economy and our electrical grid,” said AGA Vice President of Energy Markets, Analysis and Standards Richard Meyer. “As low-cost, lower-carbon energy, natural gas serves a vital purpose in ensuring grid reliability and resiliency, currently providing more than twice as much energy as any other source and continuing to grow as a share of generation.”