The Supply of Storage for Natural Gas in California
AbstractDo natural gas storage decisions in distant California respond to NYMEX futures price spreads? Daily data about flows into and out of storage facilities in California over 2002-2006 and daily spreads on NYMEX are used to investigate whether the net injection profile is consistent with the supply-of-storage curve first observed by Working for wheat. Storage decisions in California do seem to be influenced by a price signal that combines the intertemporal spread and the locational basis between California and the Henry Hub, in addition to strong seasonal and weekly cycles that determine net injections to a considerable extent. The timing and magnitude of the price response differ across storage facilities. Regulatory requirements and operational constraints also limit the response to short-lived arbitrage opportunities.
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Bibliographic InfoArticle provided by International Association for Energy Economics in its journal The Energy Journal.
Volume (Year): Volume 28 (2007)
Issue (Month): Number 3 ()
Other versions of this item:
- Uria, Rocio & Williams, Jeffrey C., 2005. "The "supply-of-storage" for natural gas in California," 2005 Annual meeting, July 24-27, Providence, RI 19288, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- F0 - International Economics - - General
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- Villeneuve, Bertrand & Creti, Anna & Chaton, Corinne, 2008.
"Some economics of seasonal gas storage,"
Economics Papers from University Paris Dauphine
123456789/5365, Paris Dauphine University.
- Corinne Chaton & Anna Creti & Bertrand Villeneuve, 2005.
"The Economics of Seasonal Gas Storage,"
2005-52, Centre de Recherche en Economie et Statistique.
- CHATON Corinne & CRETI Anna & VILLENEUVE Bertrand, 2006. "The Economics of Seasonal Gas Storage," LERNA Working Papers 06.01.194, LERNA, University of Toulouse.
- Villeneuve, Bertrand & Creti, Anna & Chaton, Corinne, 2005. "The Economics of Seasonal Gas Storage," Economics Papers from University Paris Dauphine 123456789/11515, Paris Dauphine University.
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