American Gas Foundation study examines the importance of infrastructure investments in natural gas system

A new report commissioned by the American Gas Foundation examines the regulatory changes required to support investments and infrastructure improvements to support broader energy system resilience.

A key point in the report, called “Enhancing and Maintaining Gas and Energy System Resiliency,” is the idea that the ability of the natural gas system to meet seasonal and peak day demands, even during high-impact events, must be considered when designing future energy systems. As more Americans rely on gas-powered electricity to meet their energy needs, particularly during peak demand periods and high-impact events, regulators should create a framework for natural gas utilities to make resiliency investments and upgrades.

“As we build towards our goal of a low-carbon future, we cannot lose sight of our goal to provide energy to all Americans 24/7/365,” American Gas Association President and CEO Karen Harbert said. “This study provides excellent guidance on how to get us there, including recommendations for regulations at the federal level and supportive policies in the state and local arenas. Our regulators, who share our goal, can also facilitate improved coordination between the electric and natural gas industries. AGA and its members are talking to policymakers at every level about adopting these necessary strategies.”

The report outlines several recommendations for lawmakers when developing this framework. One, it suggests that legislation or other federal directives to the Federal Energy Regulatory Commission (FERC) could establish baseline resilience requirements for jurisdictional energy systems. Also, FERC can develop rules that require electric generators operating in regulated power markets to engage with fuel suppliers that adhere to resilience requirements. Further, the report adds that FERC resiliency requirements may be adopted by some states and utilities, provided that supportive policies in the state and regulatory arenas recognize regional differences and state-specific requirements.

In addition, the study recommends improving the interdependencies and coordination between the electric and natural gas industries. To that end, FERC and the U.S. Department of Energy should consider policies that recognize the interdependencies and coordination of the natural gas and electric energy systems. Likewise, state commissions should establish workshops and/or dockets that establish rules these interdependencies.

The study was presented at a meeting held by the National Association of Regulatory Utility Commissioners on Nov. 13.