Published 12:45 pm Saturday, October 22, 2022
The U.S. natural gas industry set production and export records in 2021 and is expected to break those marks this year and surpass them again in 2023, the federal Energy Information Administration reported Oct. 21.
Called “dirty gas” by critics, natural gas continues a long-term trend toward greater production and export.
Farmers use more diesel and electricity, but natural gas still accounted for 13% of the energy consumed in food production, according to a USDA study. Manufacturing fertilizers and pesticides requires large amounts of natural gas.
The U.S. produced 37.3 trillion cubic feet of natural gas last year, outdoing the pre-pandemic high of 36.4 trillion in 2019.
Natural gas producers are on pace to exceed the volume this year, according to the EIA, and are expected to slightly increase production next year.
The U.S. exported 6.6 trillion cubic feet, topping by 26% the previous record of 5.2 trillion set in 2020. The U.S. has set export records for natural gas every year since 2015.
Horizontal drilling and hydraulic fracking have boosted production, according to the EIA. U.S. output was mostly flat or declining for three decades before starting to rise about 15 years ago.
In 2017, the U.S. became a net exporter of natural gas for the first time since 1957. Exports have more than doubled since 2017, the EIA reported.
Even with increased production, natural gas prices rose sharply in the first half of 2022 because growth in consumption was even higher, according to the EIA.
Demand for natural gas stayed high, especially on hot days. Demand for electricity generated by natural gas set a record July 21, 2021.
The previous record was set July 27, 2020, when natural gas prices were historically low, according to the EIA.
High natural gas prices typically reduce demand, but because of retired plants and low inventories, coal was not available to meet the demand for power, the EIA reported.
With prices still high, home heating bills this upcoming winter will rise by an average of 28% for natural gas customers, the EIA predicts.
The EIA projects U.S. consumption of natural gas will be 87.9 billion cubic feet per day in 2022, up by 3.9 billion cubic feet per day in 2021.
Consumption will fall slightly in 2023 as the percentage of electricity generated by natural natural drops to 36% from 38%, the EIA projects.
Renewable energy sources, primarily wind and solar, will generate 22% of the country’s electricity this year and will increase to 24% in 2023, according to the EIA.
Washington state consumed 348.6 billion cubic feet of natural gas in 2021, setting a record.
