Why New England pays a premium during peak gas demand

D. Hagan and J. Rueger, White & Case LLP, Washington DC Last winter, New England experienced one of its coldest winters in more than a century. The resulting demand for natural gas sent daily gas prices in New England spiking to $30/MMBtu over the US Henry Hub benchmark gas price (Fig. 1). Transmission organization ISO New England shows that New England’s wholesale energy prices last year were nearly $3 B more than in 2012. Fig. 1. Last winter, extremely cold weather increased gas prices in New England to $30/MMBtu over the Henry Hub benchmark price. Near New England’s western border, the Marcellus shale region in nearby New York and Pennsylvania recorded a huge