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Comparison of AEO 2008 Natural Gas Price Forecast to NYMEX Futures Prices.


DE2008934726

Publication Date 2008
Personal Author Bolinger, M. A.; Wiser, R.
Page Count 11
Abstract On December 12, 2007, the reference-case projections from Annual Energy Outlook 2008 (AEO 2008) were posted on the Energy Information Administration's (EIA) web site. We at LBNL have, in the past, compared the EIA's reference-case long-term natural gas price forecasts from the AEO series to contemporaneous natural gas prices that can be locked in through the forward market, with the goal of better understanding fuel price risk and the role that renewables can play in mitigating such risk. As such, we were curious to see how the latest AEO reference-case gas price forecast compares to the NYMEX natural gas futures strip. This brief memo presents our findings. Note that this memo pertains only to natural gas fuel price risk (i.e., the risk that natural gas prices might differ over the life of a gas-fired generation asset from what was expected when the decision to build the gas-fired unit was made). We do not take into consideration any of the other distinct attributes of gas-fired and renewable generation, such as dispatchability (or lack thereof) or environmental externalities. A comprehensive comparison of different resource types--which is well beyond the scope of this memo--would need to account for differences in all such attributes, including fuel price risk.
Keywords
  • Natural gas
  • Prices
  • Forecasting
  • Coal
  • Costs
  • Power plants
  • Volatility
  • Market
  • Comparisons
Source Agency
  • Technical Information Center Oak Ridge Tennessee
Corporate Authors Lawrence Berkeley National Lab., CA. Environmental Energy Technologies Div.; Department of Energy, Washington, DC.
Supplemental Notes Sponsored by Department of Energy, Washington, DC.
Document Type Technical Report
NTIS Issue Number 200904
Contract Number
  • DE-AC02-05CH11231
Comparison of AEO 2008 Natural Gas Price Forecast to NYMEX Futures Prices.
Comparison of AEO 2008 Natural Gas Price Forecast to NYMEX Futures Prices.
DE2008934726

  • Natural gas
  • Prices
  • Forecasting
  • Coal
  • Costs
  • Power plants
  • Volatility
  • Market
  • Comparisons
  • Technical Information Center Oak Ridge Tennessee
  • DE-AC02-05CH11231
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