Washington (Platts)--12Mar2008

US natural gas consumption could jump by as much as 20% over the next 10
years if climate change legislation under consideration in Congress becomes
law, several gas trade groups said on Tuesday.

"We want members of Congress to understand that their actions will have
serious consequences for America's natural gas customers," Dave Parker,
president and CEO of the American Gas Association and a member of the Natural
Gas Council, said in a statement on Tuesday. "Meeting the nation's clean
air goals requires natural gas and lots of it. While the natural gas industry
whole-heartedly supports increased energy efficiency, conservation, and use of
renewable fuels, US energy demands cannot be met by these measures alone."

The council's findings, sent in a letter to members of Congress,
contradict an earlier analysis by the US Energy Information Agency, which
indicated that gas use would fall if a CO2 emissions reduction bill (S. 280)
sponsored by Senators Joe Lieberman, Independent-Connecticut, and John McCain,
Republican-Arizona, becomes law.

According to the NGC letter, the legislation would lead to an increase of
roughly 20% in gas consumption over the next decade.

EIA estimated that the US would need to add 145 new nuclear reactor units
in the next 22 years, while the NGC's review--citing political opposition
driven by environmental and safety concerns--puts the number of new reactors
at closer to 25.

"Because of the rules under which EIA operates, that agency didn't factor
in the political and societal realities industry and policymakers will need to
face when complying with a possible climate change law," said NGC member Barry
Russell, president and CEO of the Independent Petroleum Association of
America. "When such realities are considered, the same analysis reveals a very
different and striking impact on energy markets."

"As a country we need nuclear power, solar, wind and coal too. But
electric utilities are switching to natural gas because it provides on-demand
power and clean air objectives quickly," added Skip Horvath, president and CEO
of the Natural Gas Supply Association.

According to Don Santa, the president of the Interstate Natural Gas
Association of America, such a switch to natural gas must be accompanied by
increased access to new natural gas supplies.

"There is currently an estimated 250 TCF of natural gas--more than 10
years of supply at the country's current rate of consumption--that is off
limits to US consumers," Santa said. "If we had access to those areas, we
could help the US economically achieve its goals to reduce greenhouse gas
emissions and keep downward pressure on prices."