2 Gas Plays On New England's Energy Policy Lunacy

Feb. 18, 2013 11:25 AM ETREXX, ENB27 Comments

There was an article in the New York Times on Friday about the challenging electricity situation in New England. The reporter took aim at

Electricity prices in New England that have been four to eight times higher than normal in the last few weeks, as the region's extreme reliance on natural gas for power supplies has collided with a surge in demand for heating.

The Times being the Times, the reporter seemed to miss the delicious irony that one of the main reasons that New England is so dependent on natural gas is environmentalists (which the paper supports consistently 95% of the time) and low natural gas prices have been successful in shutting down numerous oil & coal electricity plants over the last few years. Going further the article states the situation would be worse without New York's Indian Point nuclear plant which the Governor of New York is attempting to shut down at behest of the state's environmental lobby.

Natural gas has gone from meeting 15% of New England's overall energy needs in 2000 to over 50% currently. Pipeline capacity has failed to keep up with the expansion of natural gas demand and "renewables" have failed to make a meaningful contribution to replacing the lost energy supplies from coal & oil despite billions in tax credits, government loans and grants. The article gave me a good chuckle over the consequences of a lack of a logical cohesive energy policy, and more importantly it also provided an actionable investment theme. Given the current situation in New England and the possible closure of the Indian Point nuclear plant in New York, natural gas infrastructure is going to have to expand significantly to meet the increasing needs of the region as forces preventing oil & coal energy production from expanding are unlikely to subside. In addition, existing pipelines in the region are becoming more valuable

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