This month the U.S. Energy Information Administration, or EIA released a forecast that outlines energy production and predicts lower prices for both gasoline and natural gas.
According to the Short-Term Energy Outlook, or STEO, a combination of record production and reduced heating demand over the winter have increased the amount of natural gas in reserves.
This means the price of natural gas will be relatively low for the rest of the year, and Tim Hess, lead analyst for the STEO, said the amount used to generate electricity will increase in the Spring, falling short to coal by only 3.5 percent.
“That’s the closest the convergence has been since April of 2012,” Hess said.
Tyler Hodge, industry analyst for the EIA, says the greater use of natural gas will result in a 0.2 percent decline in carbon dioxide emissions this year.
“Natural gas generally tends to emit fewer, or less, carbon dioxide at a plant level than it would for a coal plant,” Hodge said.
Hodge said the relative amount of energy coal and natural gas generates should go back to normal after the spring ends. Natural gas prices will rise, and coal will produce higher amounts of electricity. Next year, he says there should be a 0.1 percent increase in CO2 emissions.
Hess said the rise of natural gas prices in the summer is a natural fluctuation, but by the third quarter of 2015, they will still be lower than they have been since 2013.
Hess said consumers should expect to save money at the pump this year.
“We’re expecting on average, your average household to spend about $675 less in 2015 compared to 2014,” Hess said.
In Utah, Governor Gary Herbert’s office released a report that says energy production makes up 15 percent of the state’s economy.
Holly Richardson, communications and marketing director for the governor’s Office of Energy Development, said these lower prices of both natural gas and fuel will slow down some development in the Uintah Basin, which has an economy dependent on energy production, but they won’t cause anything dire.
“At this point, it’s just seen as normal market fluctuation,” Richardson said. “And I know that people will always watch the price of natural gas, but again, it’s a huge part of the state’s economy, and it’s pretty stable.”
Richardson said because it is short-term, and prices are expected to bounce back, she does not expect to see layoffs at this point, but that could happen if prices stayed low down the road.