New study cites importance of infrastructure investment framework for natural gas system

Federal lawmakers and regulators should create a framework for natural gas utilities to make resiliency investments and upgrades, a new study by the American Gas Association (AGA) contends.

The study — “Enhancing and Maintaining Gas and Energy System Resiliency – looks at the regulatory changes required to support investments and infrastructure improvements to support broader energy system resilience. To that end, it points out 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. This becomes even more critical as Americans rely more on gas-powered electricity to meet their energy needs, particularly during peak demand periods and high-impact events.

“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,” AGA 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 study – commissioned by AGA — was presented to a meeting held by the National Association of Regulatory Utility Commissioners on Nov. 13.

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 some states and utilities may adopt FERC resiliency requirements, 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 for these interdependencies.