Sabal Trail

Florida’s electric utilities are turning to natural gas-fired power and renewables for all their incremental generation needs and as replacements for the older coal units they’ve been retiring. The state’s big bet on natural gas has been spurring the development of new pipelines. And, because of big shifts in where gas is being produced and where it’s flowing, the Sunshine State will soon be receiving an increasing share of its gas needs from the Marcellus region. Today, we discuss the slew of new gas-fired power plants that have come online, the additional plants planned, and gas flows on Sabal Trail, the first new gas mainline into the state in almost two decades.

Florida’s increasing demand for natural gas for power generation isn’t new, but like a young alligator in the Everglades, its appetite is voracious and growing. More and more gas-fired power plants have been coming online, increasing gas demand and spurring the development of new gas pipeline capacity into the state. And, because of big shifts in where gas is being produced and where it’s flowing, the Sunshine State will soon be receiving an increasing share of its gas needs from the Marcellus region. Today, we begin a two-part look at how rising generation-sector demand for gas and a new pipeline are changing gas-flow dynamics in the U.S. Southeast.

For the first time in more than a decade, Florida — the second-largest natural gas demand market for electric generation in the U.S. (after Texas) — now has a new gas supply route into the state. Last month, Enbridge’s Sabal Trail Transmission pipeline began partial service, increasing Florida’s inbound gas transportation capacity by 1.1 Bcf/d (26%) — just in time to help meet air conditioning demand during the hottest months of the summer. The pipeline ultimately will for the first time connect Marcellus/Utica shale gas to the Sunshine State’s voracious power market. In the month or so since it began service, the pipe has already ramped up to 0.4 Bcf/d and, in conjunction with additional upstream expansions, could ultimately change not only how Florida gets its gas but where that gas gets sourced. Today, we provide an update on Sabal Trail and its effect thus far on gas flows.

The Florida natural gas market will soon have access to another supply source. In June 2017, the Sabal Trail Transmission natural gas pipeline project is expected to begin service, bringing the market one step closer to connecting Marcellus/Utica natural gas to demand markets on the increasingly gas-thirsty Florida peninsula. The project will increase gas supply options for growing power generation demand in the Sunshine State while effectively also increasing gas-on-gas competition between producers in the Northeast, Gulf Coast and Midcontinent. Today we provide an update on Sabal Trail and its related projects.

The idea of using natural gas produced in Pennsylvania to generate power in South Florida would have been considered implausible or even unthinkable just a few years ago. But now it seems likely that by mid-2017 Marcellus-sourced gas will, in fact, be moving deep into the Southeast. Williams’ planned Atlantic Sunrise project will make its Transco mainline bi-directional as far south as Station 85 in southwestern Alabama. From there, Spectra Energy and NextEra Energy’s Sabal Trail pipeline will move Marcellus and other gas into central Florida, and NextEra’s Florida Southeast Connection line will take gas still further south. Today In the second of a two part series, we conclude our analysis of the transformational Atlantic Sunrise project.