case studies
During the early 1990s, the California Energy Commission (CEC) initiated an effort to bring additional pipeline capacity to California. They feared they would be simply driving gas price up in California because of the multibillion dollar cost of the pipres. “High transport costs caused high rates” they reasoned. They hadn’t embraced the economic notion that if more pipelines enter the California market, maybe gas-on-gas competition would moderate California gas prices. They hadn’t really thought through the competitive ramifications of new pipelines entering the state's gas market and whether that alone might lower gas prices for consumers. The central inquiry revolved around the extent to which the main pipeline participants, namely Kern River and PGT Expansion, could influence the reduction of gas prices or whether they would just impose high costs.
Challenges
The advanced North American multiregional gas supply-transport-demand model held the key to unlocking insights that would shape the future of California's gas market.
The predicted outcomes soon became self-evident, and California and its citizens reaped the rewards of their analytic-drive and data-assisted choices.
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