AGA report says consumers can expect lower natural gas prices this winter
An analysis by the American Gas Association said Americans can expect lower natural gas prices this winter.
In fact, natural gas prices for 2023 are on track to resemble the 2021 norm rather than the elevated prices of 2022, according to the AGA 2023 Winter Heating Outlook. Higher natural gas production and natural gas inventories that are above the five-year average are the major reasons why.
“We are seeing prices that are both stable and in line with recent historical trends,” AGA VP, Energy Markets, Analysis and Standards Richard Meyer said. “The return to lower pricing means natural gas bills are expected to decline this winter – even under colder conditions.”
Home heating prices are expected to decline by an average of 21 percent year-on-year from 2022 to 2023, according to the U.S. Energy Information Administration’s forecast. This is due to an anticipated 45 percent year-on-year decline in U.S. natural gas prices as measured at the Henry Hub.
Further, AGA said that households can save between 34 and 72 percent with natural gas compared to many popular electric alternatives. Homes and businesses already using natural gas for space heating can further cut costs this winter by 17 percent by installing a high-efficiency gas furnace.
“Utilities use a variety of supply sources to ensure they are prepared to meet customer demand during even the coldest months, helping to ensure energy reliability, especially during extreme conditions. Guided by experience and regulatory oversight, natural gas utilities plan natural gas deliveries on a daily, weekly, monthly, and seasonal basis by matching supply resources to forecasted demand and preparing for “design day” conditions or historic peak day loads,” AGA Senior Market and Regulatory Analyst Morgan Hoy said.
The U.S. natural gas industry has experienced record-high production, demand, and exports over the past year. This is in stark contrast with last year’s steep natural gas production declines, which contributed to a close call related to system integrity in the New York area during Winter Storm Elliott.
