Energy consumers and utilities in New England are growing annoyed with high energy prices and the prospect of a shortage this winter because of record U.S. gas exports to Europe.
The Financial Times reports that executives from local utilities have been calling for government assistance to prevent the squeeze, and have slammed the Jones Act for preventing more gas from reaching the Northeast coast.
The Jones Act, a wartime legislation from a century ago, prohibits non-U.S.-flagged vessels from delivering goods between U.S. ports. This means that no LNG tanker can move gas from the Gulf Coast to New England because there are no U.S.-flagged LNG tankers in the world
“You would think that charity would begin at home . . . that American fuel would go to American ports,” Joe Nolan, chief executive of Eversource Energy, told the FT in an interview. “We’re going to have to compete just like everybody else — in the global market.”
Aggravating the energy security problem for New Englanders is the fact that a lot of them use heating oil to heat their homes during winter. Heating oil, like other middle distillates, is in short supply right now. This has driven bills higher, in some cases much higher, the WSJ reported earlier this week.
Even blackouts are not out of the question for the region, the WSJ said in an earlier report from October, citing the grid operator of New England, ISO New England Inc. According to the company, if the winter happens to be colder than usual, the scarcity of gas supply could strain the grid and potentially necessitate blackouts.
“The most challenging aspect of this winter is what’s happening around the world and the extreme volatility in the markets,” Vamsi Chadalavada, ISO New England’s chief operating officer, told the WSJ. “If you are in the commercial sector, at what point do you buy fuel?”
By Irina Slav for Oilprice.com
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