Industry achievements in the past 15 years show that expectations were not unrealistic. The United States enjoys a highly competitive wholesale natural gas market and an increasingly competitive interstate transportation market. Both markets have benefited from the deregulation of natural gas production and marketing and the liberalization of natural gas prices. Introducing open access to interstate pipelines and their unbundling from gas sales has allowed end users to participate in the efficiency gains in upstream markets. All this has contributed to declining retail prices for all major consumer categories.
Deregulation is far from complete, however.
Current regulation of interstate pipeline companies and the secondary transportation market does not promote efficient allocation of transportation contracts. Flexible pricing of transportation contracts should be introduced in both the primary and secondary transportation markets. But deregulation of retail markets remains the most important task and the biggest challenge facing industry regulators. All end users should be able to choose a natural gas supplier and receive natural gas at the minimum cost to society. The full report is available in PDF format.