DWG Call. J. Austin Tuesday, July 19, 2011. Natural Gas Price Differentials. Been asked, why doesn’t TEPPC use an established forecasting service, e.g., PIRA, CERA, etc?
Tuesday, July 19, 2011
Been asked, why doesn’t TEPPC use an established forecasting service, e.g., PIRA, CERA, etc?
The Issue has to do with the Perception that the Council’s methodology just uses historic data. If so, how do you capture the new development that are lowering gas prices? New paradigm shifts (e.g., shale gas development)?
I posed the question to Terry Morlan, owner of the econometric equation, using historic data, that is used by the Council to generate gas prices at sub-regional hubs. Terry makes three points as follow:
The CEC has used the North American model in the past; Angela has stated that they’re working on a new methodology – will it be available?
PIRA and CERA uses models that idealize – maximize – minimize but do not necessary provide better results
There is the issue of committing to making all TEPPC data open, transparentand fully accessible