The Benefits and Costs of Gas Storage Development in Ohio
- The Ohio State Univ., Columbus, OH (United States)
This report examines the benefits and costs of increasing the end-use efficiency of natural gas through the use of gas storage facilities by distribution companies in Ohio. In our cost-benefit analysis the benefits to the people of Ohio from better resource allocation are compared with the costs of resources expended to obtain storage. The costs of storage facilities and of stored gas are recovered through utility rates. Benefits result from having storage facilities. One is the cost savings from needing less pipeline capacity during high demand periods. These benefits are called plant-mix benefits. Second, there are cost-rearrangement benefits that express the savings realized by the distribution company when gas storage allows a reduction in peak period supply needs and hence a reduction in peak period demand charges. Other benefits exist only when shortages exist. A model has been developed to calculate the net benefits of additional storage excluding the storage required for plant-mix benefits. The fundamental idea of the model is that enough storage should be built to satisfy the gas needs of all those winter users who are willing to pay a price for gas which at least exceeds, by the cost of storage, the price curtailed summer users are willing to pay. The limitations of the results derived from the model are due primarily trough estimates of willingness-to-pay. The major inputs to the model are the cost of storage, the price of gas purchased for storage, parameters that describe how much gas will be demanded by consumers as the price varies in summer and winter, the available summer and winter supply, and a statistical weather variable. The major outputs of the model are the optimum amount of storage, the net insurance benefits and the net conservation benefits. Themodel was applied only to the Columbia Gas of Ohio service area since data from this area were readily available.
- Research Organization:
- Ohio State Univ., Columbus, OH (United States). Dept. of Mechanical and Nuclear Engineering
- Sponsoring Organization:
- Public Utilities Commission of Ohio (PUCO)
- DOE Contract Number:
- EM-76-F-01-8088
- OSTI ID:
- 5475535
- Report Number(s):
- FE-8088-T3
- Country of Publication:
- United States
- Language:
- English
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Related Subjects
NATURAL GAS
STORAGE
STORAGE FACILITIES
ECONOMIC ANALYSIS
COST
COST BENEFIT ANALYSIS
DATA COMPILATION
DIAGRAMS
ENERGY DEMAND
GRAPHS
MAPS
MATHEMATICAL MODELS
OHIO
PRICES
SEASONAL VARIATIONS
TABLES
DATA
DATA FORMS
DEMAND
ECONOMICS
ENERGY SOURCES
FLUIDS
FOSSIL FUELS
FUEL GAS
FUELS
GAS FUELS
GASES
GREAT LAKES REGION
INFORMATION
NORTH AMERICA
NUMERICAL DATA
USA
VARIATIONS
035000* - Natural Gas- Storage- (1989-)