69 Projections through 2002 are taken from EIA’s April 2001 Short-Term Energy Outlook (and associated databases), web site www.eia.doe.gov/steo/.

70 Capacity additions by location and fuel type are listed in EIA’s Electric Power Monthly, DOE/EIA-0226(2001/03) (Washington, DC, March 2001).

71 Because natural gas utilities typically stagger their meter readings over a 20-day period to minimize their costs, some of the demand reported in the current month will actually have occurred in the previous month. For example, a portion of November’s gas consumption may be reported in December.

72 Capacity additions by location and fuel type are listed in EIA’s Electric Power Monthly, DOE/EIA-0226(2001/03) (Washington, DC, March 2001).

73 These are more recent estimates than the values provided in Chapter 2, which are based on data from EIA surveys.

74 Drilling rig data are published by Baker-Hughes, web site www.bakerhughes.com/investor/rig/index.htm.

75 Energy Information Administration, Monthly Energy Review, DOE/EIA-0035(2001/03) (Washington, DC, March 2001), Table 5.2.

76 Annual average prices have been converted to constant 1999 dollars. See Table ES1 for the relation between current-year dollars and constant 1999 dollars.

77 End-use prices and consumption levels used to derive estimates of aggregate end-use expenditures for natural gas for historical periods are taken from EIA’s Natural Gas Monthly. Projections and estimates for some recent values are from the April 2001 version of EIA’s Short-Term Integrated Forecasting System database, which contains model results used to produce the April 2001 Short-Term Energy Outlook.

78 The deflator used to convert nominal expenditures to real dollars is the chained GDP price deflator.

79 Typical household winter gas expenditures are calculated as the product of estimated per-household winter gas usage and reported average residential prices form EIA’s Natural Gas Monthly and Short-Term Energy Outlook. Per-household usage is based on EIA’s 1997 Residential Energy Consumption Survey (RECS), except that per-household consumption is converted to consumption per heating degree-day and then reconstructed for the winter period (October-March) instead of the as-reported calendar year basis.

80 The source of recent and projected values for household winter gas costs is EIA’s April 2001 Short-Term Energy Outlook.

81 The methodology used to derive the alternative macroeconomic scenario was as follows: (1) start with the base case macroeconomic simulation for the April 2001 Short-Term Energy Outlook (DRI CONTROL0301); (2) resimulate the macro model for the 2001-2002 period with natural gas prices changed so as to replicate (relative to the base case) the gas price changes seen or expected for the 1999-2001 period; and (3) use the differences from the baseline for the 2001-2002 period as an indicator of the approximate impacts of higher gas prices on economic aggregates (output, income, inflation) for 2000 and 2001.

82 Information taken from EIA’s quarterly analysis of major energy companies’ financial performance, web site www.eia.doe.gov/ emeu/perfpro/news_m/index.html.

83 Information taken from EIA’s quarterly analysis of independent energy companies’ financial performance, web site www. eia.doe.gov/emeu/perfpro/news_i/index.html.

84 Energy Information Administration, Annual Energy Outlook 2001, DOE/EIA-0383(2001) (Washington, DC, December 2000), web site www.eia.doe.gov/oiaf/aeo/. All information describing the mid-term outlook after 2005 is taken from AEO2001. The AEO2001 projections are not meant to be exact predictions of the future but represent a likely future, assuming known trends in demographics and technology improvements, and also assuming no change in current law, regulation, and policy. Important assumptions include: (a) current laws and regulations (as of August 2000); (b) continuation of current trends in research and development (R&D) and technological progress; (c) current estimates of resource availability; and (d) consistent with consumer values and choices.

85 Energy Information Administration, Monthly Energy Review, DOE/EIA-0035(2001/03) (Washington, DC, March 2001).

86 Standard and Poor’s DRI, Simulation T250200 (February 2000).

87 For a general description of NEMS, see Energy Information Administration, National Energy Modeling System: An Overview 2000, DOE/EIA-0581(2000) (Washington, DC, March 2000), web site www.eia.doe.gov/oiaf/aeo/overview/.

88 Energy Information Administration, Monthly Energy Review, DOE/EIA-0035(2001/03) (Washington, DC, March 2001).

89 An expected fundamental price path assumes that the industry gears up without efficiency losses imposed by too rapid a rate of investment in rigs and crews and the absence of factors causing price volatility (e.g., weather, pipeline or infrastructure accidents, or supply bottlenecks). See Energy Information Administration, Monthly Energy Review, DOE/EIA-0035(2001/03) (Washington, DC, March 2001).

90 Energy Information Administration, Monthly Energy Review, DOE/EIA-0035(2001/03) (Washington, DC, March 2001).

91 Energy Information Administration, Monthly Energy Review, DOE/EIA-0035(2001/03) (Washington, DC, March 2001).

92 Computed from Energy Information Administration, Annual Energy Review 1999, DOE/EIA-0384(99) (Washington, DC, July 2000), Table 1.2.

93 Gas Research Institute, GRI 2001Baseline Projection (February 2001), pp. HSM 112-113. GRI and the Institute of Gas Technology (IGT) have recently merged into a combined company, Gas Technology Institute (GTI).

94 W. Fisher, “Energy and Environment into the Twenty First Century,” Environmental Geo Sciences, Vol. 16, No. 4 (1999), pp. 191-199.

95 To illustrate the conservative nature of the resource estimation process and the difficulty of producing accurate estimates, the USGS crude oil recoverable estimate in 1980 would have had the U.S. run out of oil by the early 1990s.

96 Canadian Gas Potential Committee, Natural Gas Potential in Canada (Calgary: University of Calgary, 1997), p. 1.

97 National Research Board, Canadian Energy Supply and Demand to 2025 (Calgary, 1999), p.43.

98 Interregional pipelines transport natural gas across Census divisions.