The Canadian Gas Association (CGA) says that pre-heating season price outlooks, released today, point directly to why Canadian governments and regulators need both to support the development of new energy supplies and assist consumers to make efficient energy choices.

The U.S. Energy Information Agency's Winter Fuels Outlook projects that US consumers will see higher prices for energy this winter. CGA's Natural Gas Markets Pre-heating Season Update, also released today, summarizes the various pressures on natural gas supply and demand and also indicates that Canadian consumers will face higher natural gas prices this winter.

"Our analysis concludes that higher natural gas prices are a reflection of various pressures on the supply/demand balance. These include a strong increase in demand for natural gas, high oil prices, recent production disruptions in the United States, a levelling off of production from low cost sources, and delays in the development of new gas supplies," said CGA President and Chief Executive Officer, Michael Cleland.

Natural gas distribution utilities, which pass on the cost of natural gas to customers with no mark-up, have been taking steps to mitigate the effects of these market conditions. Efforts to store gas for use in winter months, hedge the price of winter supplies, and support energy efficiency programs provide customers with some insurance against winter price spikes.

However, CGA continues to encourage governments and regulators to recognize their role in addressing the supply side of the equation.

"Governments have a large role to play through faster, more certain, lower cost and more effective regulatory processes to ensure that remote and unconventional sources of supply are brought to market," said Cleland. "Liquefied natural gas (LNG) and coalbed methane are just two examples of new sources of natural gas that, with a more efficient regulatory environment could help address the need for more supply in the near future," said Cleland.

Founded in 1907, the Canadian Gas Association (CGA) is made up of over 200 companies, organizations and individuals who are involved in the delivery of natural gas in Canada and the United States.

News Release