by Matthew R. Simmons
Chairman and CEO
Simmons & Company International

As the world's largest energy consumer, America is fortunate to be virtually self-sufficient in each key energy source, with the exception of oil. And of the key sources, natural gas is assuming greater importance, both because it is available domestically and because it is the cleanest energy source used on any significant scale. Yet our natural gas supply could come up short as soon as this winter.

The case begins with the 1999 National Petroleum Council (NPC) report, "Natural Gas – Meeting the Challenges of the Nation's Growing Natural Gas Demand," which predicted U.S. gas demand would grow from 22 TCF per year to almost 30 TCF by 2010 based on the large number of new gas-fired power generation plants needed to meet growth in electricity demand.

There were three task forces that compiled this study. I served as the chairman of the Demand Task Force and a member of the integrating team of this study. When released, the report's demand assumptions generated considerable skepticism, principally because most readers did not realize the number of gas-fired power plants actually on order. In the 30 months following the NPC report's release, power generator orders far exceeded the total number of gas-fired power plants the NPC predicted by the end of 2010.

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