Predicting the timing of the onset of any competition is equally impossible. In the competitive circumstances in which new NUGs would enter such an electricity market, degree of competition and timing of onset are critical financial factors. Any NUG attempting early entry into such a market takes a serious risk. Failure to accurately predict either the competitive situation or the moment of its arrival could create fatal financial consequences. Potential Effects of the New Electricity Market on the Natural Gas Industry Combined cycle generation is the likely tool of any NUG entering the proposed new competitive electricity market.
Natural gas is the fuel of choice for such generating plants.
It is important, then, to understand which electric utility plants are at risk from combined cycle operations and how they are fueled. To place this in perspective, the replacement values for various utility steam turbine fuels are considered in terms of natural gas potentially burned in combined cycle operations at 6.25 ft 3 per KWH of electricity generated. The resulting values are an upper limit since they assume full and unlimited competition. Natural gas fired steam turbine generation in Louisiana was 30.132 billion KWH and used 313.4 billion ft 3 of natural gas. Natural gas fired steam turbine generation in the U.S. was 267.7 billion KWH and used 2,772.9 billion ft 3 of natural gas.