ICF International forecasts natural gas prices to increase between 2015 and 2020 as demand increases from new petrochemical plants, liquefied natural gas export terminals and pipeline exports to Mexico.
The Fairfax, Va.-based consulting contractor attributes the increase to the cold winter in the Eastern U.S. and also predicts more drilling for energy to occur in response to the price increases, ICF said Tuesday.
In its new “ICForecast Energy Outlook” report, ICF also attributes price increases to regulatory changes such as one from the Environmental Protection Agency that the company expects to be released in June regarding carbon dioxide emissions from existing generators.
“Regulation of CO2 from existing sources will cause companies to consider incremental retirements and investments while recent weather and the resulting gas price response make them reconsider past retirements,“ said Chris MacCracken, a principal at ICF.
The company expects U.S.-based coal plants to retire nearly 65 gigawatts by 2020 based on regulations that includes carbon dioxide and EPA's other proposed rules.
ICF also outlines its view of how natural gas-fired units could increase its presence in base loads across many markets in the U.S., including historically coal-dominant regions such as the Midwest and Southeast in the U.S.