Natural gas pricing provisions of President Carter's energy plan: a briefing paper for Governor Briscoe
The basic approach to the problem of natural gas pricing and the problem of interstate shortages is a movement toward increased regulation and therefore a movement in the wrong direction. The problems of pricing and allocation of this increasingly scarce natural resource can best be solved by the market forces of supply and demand rather than government decree. Government has badly failed on this count in the past as evidenced by the current shortages in the interstate market and there is no reason to believe that the performance will be improved by expanding this control to the interstate market and by deciding which uses of gas are of highest priority. The Plan does provide for higher prices for new gas than now exists in the interstate market and, therefore, must be taken as an improvement in the pricing problem in that market in the short term. But the Plan also calls for intrastate price ceilings below the market clearing price in that market and would be likely to lead to shortages. The requirements (time table phase out, oil and gas taxes and tax credits) for conversion from oil and gas do not take adequate account of the degree of existing dependence of natural gas in Texas' industry and utilities. The primary purpose of these policies is to free up gas for commercial and residential use in consuming states. The same objective can be achieved through free market conditions if (1) deregulation is achieved, (2) consumers everywhere are charged the full price of new gas bought by interstate pipelines from new production and (3) existing holders of natural gas contracts in the intrastate market are allowed to sell part or all of their gas to the interstate system at market prices. 1 table
- Research Organization:
- Texas Governor's Energy Advisory Council, Austin (USA)
- OSTI ID:
- 5356791
- Report Number(s):
- NP-4900770; ON: DE84900770
- Country of Publication:
- United States
- Language:
- English
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030600 -- Natural Gas-- Economic
Industrial
& Business Aspects
031000* -- Natural Gas-- Legislation & Regulations
ALLOCATIONS
DEREGULATION
ECONOMIC IMPACT
ENERGY SOURCES
FEDERAL REGION VI
FLUIDS
FORECASTING
FOSSIL FUELS
FUEL GAS
FUELS
GAS FUELS
GASES
MARKET
NATURAL GAS
NORTH AMERICA
PRICING REGULATIONS
REGULATIONS
SUPPLY AND DEMAND
TEXAS
USA