Electricity Sector Demand for Natural Gas in the United States

Peter Hartley, Kenneth Medlock and Jennifer Rosthal
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Jennifer Rosthal: Rice University

Working Papers from Rice University, Department of Economics

Abstract: We examine determinants of the natural gas share in power generation for the NERC regions in the US. Our results indicate that plant and grid-level fuel-switching, technology in generation, installed capacity and weather all affect the natural gas share of energy input into power generation. Furthermore, we argue that fuel-switching is likely an important demand-side factor in establishing a long run relationship between the prices of petroleum products and natural gas. We estimate two specifications--a translog specification for expenditure share and a double logarithmic transformation of gas-fired capacity utilization--because our analysis calls into question the validity of the translog specification for analyzing fuel shares in the power generation sector.

Date: 2014
New Economics Papers: this item is included in nep-ene, nep-ger and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:ecl:riceco:14-026

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