"Retail access will reinforce the trend towards greater use of natural gas in power generation, resulting from the development of combined-cycle gas turbine (CCGT) power plants," said study author George Given.
CERI says new CCGT technology is the key factor leading to increased use of natural gas for power generation.
"New CCGT capacity is chosen to replace some existing capacity," said Given, "but, more importantly, it is built to meet future demand growth."
CCGT-based plants have the lowest "levelized" cost among generation technologies, says CERI. They can be sited more easily, are modular in design, and produce lower levels of emissions than other available fossil-fuel technologies. And operating and maintenance costs for CCGT plants are relatively low.
Growing demandGiven growth in CCGT use, CERI predicts that, under a full retail-wheeling scenario (fully liberalized sale of electricity by generators and marketers directly to consumers), gas demand for power generation in Canada would mushroom from 200 trillion BTU in 2000 to 1,327 trillion BTU by 2020. In the Lower 48, gas use for generation would triple during the period, reaching 10,900 trillion BTU in 2020.
High-growth areas for the two nations will be: central Canada, where Given says gas consumption by power generators could quadruple by 2010 and reach 804 trillion BTU by 2020; and the "East North-Central U.S." and New England states.
Not all regions will experience robust demand growth, says CERI: "Increased power trade, fuel switching, and lower utilization of high-cost and low-efficiency gas oil steam plants occur. This indicates that increased competition will drive generators to become more efficient and run many existing plants at higher utilization levels.
"As a result," said CERI, "gas demand growth could lag behind the forecast growth in a more regulated environment during the first 10 forecast years."
The study indicates that natural gas producers, transporters, and marketers will be able to meet the added gas demand resulting from electricity industry restructuring over the entire forecast period.
"Total Canadian production is projected to reach 7.7 tcf in 2010 and 8.7 tcf by 2020," said Given. Over the period, Canadian gas exports to the U.S. will increase to 12.18 bcfd in 2010 from 8.69 bcfd in 1998. Gross export volumes are expected to peak at 13.4 bcfd in 2015 and decline gradually through 2020.
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