The following remarks about natural gas were delivered by Texas 2036 Senior Policy Advisor Jeremy Mazur to the Texas Senate Committee on Natural Resources & Economic Development on Sept. 15, 2022.
I want to start by emphasizing the importance of natural gas for both domestic energy needs and global energy security.
We know that natural gas can be a reliable feedstock for electric power generation. Currently, the majority of Texas’ electric power needs are served by natural gas.
In fact, this summer the amount of electricity generated by natural gas reached a record high according to the US Energy Information Administration.
Beyond our domestic needs, what’s happening in Europe underscores the strategic importance of natural gas. Russia’s invasion of the Ukraine, and subsequent actions to choke Europe’s natural gas supplies, have forced European leaders to scramble for alternatives.
Many have turned to liquefied natural gas, or LNG. European imports have reached record levels this year. Much of this inventory is coming from US and Texas ports.
I make these points to emphasize the importance of natural gas to not only our own energy needs, but also those for the global economy. Reliable natural gas supplies are essential for keeping the lights on and our economy running.
That said, I have these observations to offer about underground gas storage.
First, gas storage can serve as a reliable thermal resource when intermittent sources of energy generation, such as wind and solar, cannot deliver.
Second, storage can support fast-ramp supply needs for natural gas fueled electric providers.
And lastly, storage is a hedge against future supply disruptions and price shocks. One way to think of it is as a strategic reserve for future uncertainty.
So we know that natural gas is critical for our state’s energy needs. And we know that natural gas storage is an important tool for maintaining available gas supplies.
I have two additional observations to offer here.
First, natural gas is not the only gas that can be stored underground for future energy demands. Hydrogen is fast revealing itself as a viable energy source that can also be stored underground. One option would be to not only encourage the development of hydrogen resources, but also its underground storage.
Second, I would be remiss if I didn’t point out another underground resource for natural gas storage: pipelines. The larger our natural gas pipeline network, the better our built underground storage capacity. Just as pipelines can be a safe and effective way to convey natural gas, they can be packed to store gas for when it’s needed.
Texas has one of the largest pipeline networks in the United States. Towards that end, Texas needs to maintain regulatory certainty for the operation of intrastate pipelines under the jurisdiction of the Railroad Commission. This will help ensure the development and operation of a pipeline network needed to store and convey natural gas for both state energy needs and global demands.