IBJOpinion

Shale gas will support inexpensive electricity

November 30, 2013
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IBJ Letters To The Editor

As stated in the “Natural gas dilemma” article [Nov. 18], there is increased demand for natural gas in the electric energy market in Indiana and across the country. However, I take exception to the theme that this increased demand will drive volatility in the market and harm Hoosier electric and gas customers.

As we previously announced, Vectren’s winter gas bills for central Indiana will be slightly higher than last year, but remain near historic lows. Local distribution companies like Vectren simply deliver the gas to homes and businesses at the price paid. State law prohibits utilities from making a profit on the commodity price.

In fact, gas prices are so attractive, we received approval to purchase some hedged gas well into the future, locking in a portion of our supply up to 10 years out at prices around $4 to $4.70 per unit. Our purchasing strategy has always been about making sure customers have a reasonable-cost supply.

Shale gas, known as the “game changer” of the energy industry, is now being produced in 32 states. It has helped put domestic gas supply at levels not seen since 1971.

According to a May 2013 Energy Information Administration report, shale gas development will go from between 30 percent and 35 percent of U.S. gas supply to 50 percent by 2040. This abundant supply was the catalyst for the substantial dip in market prices between 2008 and 2009, and the certainty of shale gas for decades to come is the reason market volatility has mitigated substantially.

According to the same report, domestic natural gas production is growing faster than consumption, and the U.S. will become a net exporter of natural gas around 2020.

Our nation’s strong natural gas supply fundamentals and robust and reliable natural gas delivery infrastructure suggest that through the next decade and beyond, a range of demand scenarios can be met by a diverse and responsive supply market within an estimated price band of $4 to $6.50 per MMBtu in today’s dollars—a level well below the peak market prices of the preceding decade.

The short- and long-term outlook for the supply and price of natural gas remains extremely positive for the U.S. It is important we continue supporting policies for responsible fracking and put this domestic source of energy to use for all customers.
__________

Carl Chapman
CEO, Vectren Corp.

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  1. Why not take some time to do some research before traveling to that Indiana town or city, and find the ones that are no smoking either inside, or have a patio? People like yourself are just being selfish, and unnecessarily trying to take away all indoor venues that smokers can enjoy themselves at. Last time I checked, it is still a free country, and businesses do respond to market pressure and will ban smoking, if there's enough demand by customers for it(i.e. Linebacker Lounge in South Bend, and Rack and Helen's in New Haven, IN, outside of Fort Wayne). Indiana law already unnecessarily forced restaurants with a bar area to be no smoking, so why not support those restaurants that were forced to ban smoking against their will? Also, I'm always surprised at the number of bars that chose to ban smoking on their own, in non-ban parts of Indiana I'll sometimes travel into. Whiting, IN(just southeast of Chicago) has at least a few bars that went no smoking on their own accord, and despite no selfish government ban forcing those bars to make that move against their will! I'd much rather have a balance of both smoking and non-smoking bars, rather than a complete bar smoking ban that'll only force more bars to close their doors. And besides IMO, there are much worser things to worry about, than cigarette smoke inside a bar. If you feel a bar is too smoky, then simply walk out and take your business to a different bar!

  2. As other states are realizing the harm in jailing offenders of marijuana...Indiana steps backwards into the script of Reefer Madness. Well...you guys voted for your Gov...up to you to vote him out. Signed, Citizen of Florida...the next state to have medical marijuana.

  3. It's empowering for this niche community to know that they have an advocate on their side in case things go awry. http://www.youtube.com/watch?v=Lrst9VXVKfE

  4. Apparently the settlement over Angie's List "bundling" charges hasn't stopped the practice! My membership is up for renewal, and I'm on my third email trying to get a "basic" membership rather than the "bundled" version they're trying to charge me for. Frustrating!!

  5. Well....as a vendor to both of these builders I guess I have the right to comment. Davis closed his doors with integrity.He paid me every penny he owed me. Estridge,STILL owes me thousands and thousands of dollars. The last few years of my life have been spent working 2 jobs, paying off the suppliers I used to work on Estridge jobs and just struggling to survive. Shame on you Paul...and shame on you IBJ! Maybe you should have contacted the hundreds of vendors that Paul stiffed. I'm sure your "rises from the ashes" spin on reporting would have contained true stories of real people who have struggled to find work and pay of their debts (something that Paul didn't even attempt to do).

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