Although naturally occurring gas has been known since ancient times, its commercial use is relatively recent. In about 1000, B.C., the famous Oracle at Delphi, on Mount Parnassus in ancient Greece, was built where natural gas seeped from the ground in a flame. Around 500 B.C., the Chinese started using crude bamboo “pipelines” to transport gas that seeped to the surface and to use it to boil sea water to get drinkable water.
The first commercialized natural gas occurred in Britain. Around 1785, the British used natural gas produced from coal to light houses and streets. In 1816, Baltimore, Maryland used this type of manufactured natural gas to become the first city in the United States to light its streets with gas.
In the United States, the properties of natural gas were discovered by Native Americans, who would ignite the gases that seeped into and around Lake Erie. French explorers witnessed this practice around 1626. In 1821, William Hart dug the first successful natural gas well in the U.S. in Fredonia, New York. Eventually, the Fredonia Gas Light Company was formed, becoming the first American natural gas distribution company.
In 1836, the City of Philadelphia created the first municipally owned natural gas distribution company. Today, U.S. public gas systems number more than 900, and the Philadelphia Gas Works is the largest and longest operating public gas system in the U.S.
During most of the 19th century, natural gas was used almost exclusively as a source of light, but in 1885, Robert Bunsen's invention of what is now known as the Bunsen burner opened vast new opportunities to use natural gas. Once effective pipelines began to be built in the 20th century, the use of natural gas expanded to home heating and cooking, appliances such as water heaters and oven ranges, manufacturing and processing plants, and boilers to generate electricity.
Today, natural gas is a vital component of the world's supply of energy. Natural gas currently supplies more than one-half of the energy consumed by residential and commercial customers, and about 41 percent of the energy used by U.S. industry. It is one of the cleanest, safest, and most useful of all energy sources.
Ninety-nine percent of the natural gas used in the United States comes from North America. Because natural gas is the cleanest burning fossil fuel, it is playing an increasing role in helping to attain national goals of a cleaner environment, energy security and a more competitive economy. The two million-mile underground natural gas delivery system has an outstanding safety record.
As this 2004 edition of the APGA History Highlights goes to print, liquefied natural gas (LNG) is beginning to play a more prominent role in the overall gas supply picture. Although about one percent of the natural gas consumed in this country is currently imported as LNG, it is estimated that our nation's imports of LNG will grow to approximately 7 or 8% by the end of this decade. This will require more than the four LNG facilities that currently exist.
Natural gas distribution companies have always been subject to regulation by state and local governments. In 1938, however, with the growing importance of natural gas, concern over the heavy concentration of the natural gas industry, and the monopolistic tendencies of interstate pipelines to charge higher than competitive prices due to their market power, the U.S. government began regulating the interstate natural gas industry with passage of the Natural Gas Act. The Act was intended to protect consumers from possible abuses such as unreasonably high prices. The Act gave the Federal Power Commission (FPC) jurisdiction to regulate the transportation and sale of natural gas in interstate commerce. The FPC was charged with regulating the rates that were charged for interstate natural gas delivery and with certifying new interstate pipeline construction if it was consistent with the public convenience and necessity.
The Department of Energy Organization Act of 1977 transferred to the five-member Federal Energy Regulatory Commission (FERC) most of the former FPC’s interstate regulatory functions over the electric power and natural gas industries, including setting the rates and charges for the transportation and sale for resale of natural gas in interstate commerce. The Act also transferred to the FERC from the Interstate Commerce Commission the authority to set oil pipeline transportation rates and to set the value of oil pipelines for ratemaking purposes.
In the 1980s, a movement toward deregulation of the natural gas industry began. In 1985, FERC issued Order No. 436, which barred pipelines from discriminating against transportation requests based on protecting their own merchant services, thus at least in theory providing all customers the same right to pipeline transportation that industrial fuel-switching customers had enjoyed since the early 1980s. The movement toward allowing pipeline customers the choice in the purchase of their natural gas and their transportation arrangements became known as ‘open access.’ FERC Order No. 636, issued in 1992, completed the process of unbundling gas supply from gas delivery by making pipeline unbundling a requirement. It provided for the complete unbundling of transportation, storage, and sales; the customer (the local gas distribution system) now chooses its gas supplier and (if it has options) the pipeline(s) to transport its gas.
In 1989, Congress completed the process of deregulating the price of natural gas at the wellhead, which was begun in 1978 with the passage of the Natural Gas Policy Act, by passing the Natural Gas Wellhead Decontrol Act (NGWDA). The NGWDA repealed all remaining regulated prices on wellhead sales. In the current federal regulatory environment, only interstate pipelines are directly regulated as to the transportation of gas in interstate commerce. Investor-owned local distribution companies (LDCs) are typically regulated by state public service commissions regarding the services they provide. Natural gas producers and marketers are not directly regulated by the federal government as to rates and related matters. Interstate pipeline companies are regulated regarding the rates they charge, the access they offer to their pipeline facilities, and the siting and construction of new pipelines. Similarly, local distribution companies (excluding most municipally owned public gas systems) are regulated by state public service commissions, which oversee their rates and construction issues, and ensure that proper procedures exist for maintaining adequate supply to their customers.
In the late 1990s and early years of the twenty first century, APGA has been largely concerned with attempting to ensure that the tariff rates for pipeline services are set at just and reasonable levels and that pipelines do not discriminate with respect to the terms under which they provide such services. APGA has also been at the forefront of those seeking price transparency in the marketplace as a means of fostering more stable prices for natural gas. In addition, APGA has been seeking to promote the efficient and judicious use of natural gas to reduce the extent to which demand for the product outruns the available supply and drives prices to even more exorbitant levels.
The US natural gas pipeline system is a complex system of pipelines that carries natural gas nationwide and for import and export for use by millions of people daily for their consumer and commercial needs. Across the country, there are more than 210 pipeline systems that total more than 305,000 miles of interstate and intrastate pipelines.[1]
Of the lower 48 US states, those with the most natural gas pipeline running through them are Texas (58,588 miles), Louisiana (18,900), Oklahoma (18,539), Kansas (15,386), Illinois (11,900) and California (11,770). The states with the least natural gas pipeline are Vermont and New Hampshire.[1]
Regulation
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A gas valve cover in Boston, Massachusetts.The US DOT Office of Pipeline Safety (OPS) administers the national regulatory program to assure the safe and environmentally sound transportation of natural gas, liquefied natural gas and hazardous liquids by pipeline. The Federal Energy Regulatory Commission reviews and authorizes the operation of the interstate natural gas pipelines.[2] Intrastate pipelines that run within one state and do not cross state boundaries are typically regulated by a state government agency. For example, in Texas, the Railroad Commission of Texas[3] regulates pipelines, and in Louisiana, it is the Louisiana Department of Natural Resources.[4]
Development
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A small natural gas pipeline substation in Bowling Green, OhioEarly Pipelines and Markets
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The first natural gas sold in the U.S. was in Fredonia, New York in 1825, by William Hart. It was built to pipe the gas from the well to nearby shops, Hart improvised a gasometer at the well site and laid pipe to the properties of his first customers.[5][6] Hart was later consulted to develop a gas lighting system for the Barcelona Lighthouse in 1829.[7] These early pipelines (no longer in use) were made of pine logs.[8]
Meanwhile, manufactured gas was more commonly used than natural gas in the early 19th century, first introduced in Baltimore in 1816 with underground pipes laid starting in 1851.[6] Gas plants could be sited within cities, and many major U.S. cities such as New York, Chicago, San Francisco had gas distribution lines for manufactured gas by the 1870s.[9]
The first major U.S. city to pipe in natural gas was Pittsburgh, in 1883, sold by Penn Fuel Gas Company from a well twenty miles from the city, and transported via a wrought-iron pipe 5 5/8 inch in diameter.[9][10] This pipeline to Pittsburgh was the first use a telescoping design with narrower pipeline at the well site and widening widths as it entered the city as a means to control the pressure inside the line.[10]
Discovery of huge oil and gas fields in the Southwest US, combined with pipeline engineering advancements and national market demand ultimately led to the development of long-distance, interstate pipelines in 1920s and 1930s.[10] Until the passage of the Natural Gas Act of 1938, pipelines were regulated only by states; the Act gave federal oversight to the transportation and sale of natural gas and required approval by the Federal Power Commission for new interstate lines.[9]
Just after World War II, demand for natural gas increased, and so did the development of pipelines to new markets on the West Coast in California and in the Southeastern states.[10] About half of today's existing natural gas pipelines were built in the 1950s and 1960s during this postwar boom.[11]
19th and 20th Century Technologies and Technical Standards
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In 1885, Solomon Dresser patented a new coupling that was an important advancement in engineering pipeline, making it possible to assemble longer, less leaky pipes that were easier to screw together.[9]
Compressors, more commonly adopted after 1910, began to be used to control the pressure within natural gas pipelines.[12]
Pipeline laid before the 1950s did not have technology for inspecting buried lines for erosion or corrosion; starting that decade, most pipeline operators began using pigging systems as well as external pipe coating to protect pipes from decay and detect defects.[13]
Steel has been used in many pipeline projects since the 1950s, as well as plastic beginning in the 1970s.[14]
In 1970, the federal Gas Code (Part 192) was adopted, based on the ASME B31.8 technical standard that was in use by some states to regulate the quality and safety of pipeline construction; pipelines installed before these safety rules were established were granted exceptions.[13]
Modern Developments
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At the end of 2008, the U.S. had 305,000 miles of natural gas interstate and intrastate transmission pipelines in the lower 48 states.[15] The full pipeline network is an estimated 3 million miles, including transmission lines as well as gathering lines, mains, and service lines to consumers.[11] Transmission pipelines are generally 6 to 48 inches (15 cm to 1.2 m) in diameter, made of strong carbon steel or advanced plastic;[16] the largest diameters are for intrastate and interstate transmission lines, that channel natural gas into smaller mains, and service lines.[17]
Many bare steel pipelines (uncoated) and other aging pipelines like those made of iron or brittle plastics, are being taken out of service and replaced to prevent pipeline failures.[14][18]
Safety
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Over the years, there have been many natural gas explosions involving pipelines in which people have been injured or killed. The most recent was the 2010 San Bruno pipeline explosion that killed at least four people, injured 60 and more victims are still missing.[19] Portions of the San Bruno pipeline had been built in 1956.
In ideal situations, pipeline inspection gauges or a “PIG” (see Pigging) is used to inspect and ensure the safe operation of natural gas pipelines. About 63 percent of all natural gas pipelines in the US cannot be properly inspected using a PIG, or automatic robot in the pipes, because the pipelines are either too old or they twist and turn and PIGs cannot operate in them.[20]
Many experts and studies show that the inferior oversight of gas pipelines have led to hundreds of pipeline accidents that have “killed 60 people and injured 230 others in the last five years,” according to the New York Times. This analysis excludes the casualty figures from the 2010 San Bruno pipeline explosion that killed 7 people and injured more than 50 others.[21]
See also
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References
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