Properties Magazine February 2017 : Page 13

BOMA BUSINESS Exploring timely topics with BOMA members Considering a Long-Term Natural Gas Plan? hen it comes to planning for your properties’ natural gas needs, it’s important to feel confident with your pricing and terms. To better understand today’s market conditions, it is helpful to get a sense of what has taken place over the past year to impact pricing, and the factors that may affect future pricing. W Last winter was much milder than expected, and natural gas storage levels remained at a three-year high. Interestingly, there was a price spike during the spring-summer time period, but not because of the warm winter. Instead, it was largely due to the upswing in the use of natural gas for power generation (which resulted from the previ-ously low prices). As a result, producers were halting production during those previous low price points in the market, which drove prices up in the short term. However, long-term pricing has actu-ally remained much more stable as of late. How can you use this information in planning for your natural gas (and power) procurement needs? • From a supply perspective, shale production remains strong, but as previously proven, producers have demonstrated that they are willing to curb drilling if prices go too low Given the short-term vola-tility and the relatively stable long-term pric-ing, a strong case can be made for locking in a long-term rate now. ENERGY SO YOU DON’T HAVE TO Contact us today and gain more control over your building’s energy costs WE SPEAK The impact on power pricing With the recent run-up in nat-ural gas prices, power prices have also experienced dramatic volatil-ity, especially January and February 2017 prices. These two months are traditionally very high consumption months as many apartment dwellers and homeowners have electric heat-ers. The impending cold weather is bringing with it price spikes that we have not seen lately in power pric-ing. Thankfully, longer term electric prices have been minimally impacted and remain at attractive levels for end users. P BOMA Greater Cleveland is proud to provide this space to our Associate Members so they can inform, educate and share their knowledge with property management professionals. This article was written by Andrea Longbrake, lead com-mercial account manager of IGS Energy. Andrea can be reached at 614.659.5190 or alongbrake@ IGS Energy can be found on the web at Preferred natural gas supplier since 1996 Planning ahead Where prices will go into the future remains to be seen, but there are a couple of key factors of note that could potentially cause an increase: • The U.S. is now exporting Liquefied Natural Gas, with exports expected to increase – November 2016 marked the first time ever that the United States was a net exporter of natural gas • Power generation continues to rely more and more on natural gas, espe-cially as coal retirements continue ANDREA LONGBRAKE Senior Commercial Account Manager 614.659.5190 13

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