Thursday, October 13, 2005


The California Energy Commission is taking a renewed interest in Liquefied Natural Gas as a solution to the State's supply imbalances.

Californians may soon have something to distract them from high gas prices:
high utility bills.

State officials and a coalition of industry groups are trying to head off
this possibility with long term plans for bringing in large supplies of
liquefied natural gas (LNG) from overseas. While battles with
environmentalists have dominated the headlines about LNG, long-term price
volatility may prove to be a bigger risk.

Last Friday, representatives from the California Energy Commission presented
a draft energy report that outlined a potential two-part strategy for
keeping down Californians' energy bills: driving down the demand side with
conservation while pumping up the supply side with imported LNG. While CEC
officials have not specifically endorsed such a strategy, they say the
report shows the state how to escape the crunch caused by the combination of
growing demand and flat domestic supplies.

"Once you let LNG expand, you're going to see a significant amount of
cheaper gas coming into the continent," Jairam Gopal, a supervisor with the
CEC's Natural Gas Office told an audience at the meeting.