If you have an ACS member number, please enter it here so we can link this account to your membership. (optional)

ACS values your privacy. By submitting your information, you are gaining access to C&EN and subscribing to our weekly newsletter. We use the information you provide to make your reading experience better, and we will never sell your data to third party members.



Chemical Ceos Protest Natural Gas Prices

by Jeff Johnson
February 2, 2004 | A version of this story appeared in Volume 82, Issue 5

Chief executives from the nation's 19 largest chemical companies have written President George W. Bush and congressional leaders, asking that the government curb high natural gas prices.

The CEOs urge the government to adopt a national program to raise energy efficiency, reduce natural gas use for electricity, increase drilling, and expand tax relief for gas producers.

The chemical industry has been hard hit by high gas prices because it uses gas as fuel and feedstock and is the U.S.'s leading gas consumer.

The CEOs say today's high prices come when national gas inventories are at record highs--9% above the five-year average. The CEOs blame the government, charging that its environmental policies have spurred greater gas use for electricity generation.

However, natural gas use by electric utilities over the past several years has been flat or declining, according to Energy Department figures, and its analysts note that even if gas prices drop, chemical companies will still be in trouble.

Utilities have indeed installed more clean-burning, efficient natural-gas-fired turbines over the past decade. However, high gas prices have led utilities to burn cheaper fuel, mainly coal, while waiting for the price of gas to decline.

The analysts argue that high gas prices are likely to fall later this year, but they also warn that with cheaper prices, utilities will fire up now-idle gas turbines, leading to more demand, price volatility, and a new round of price spikes.


This article has been sent to the following recipient:

Chemistry matters. Join us to get the news you need.