Reducing Energy Costs

Future natural gas prices are expected to be higher, but demand will grow more slowly than in previous projections, according to the Energy Information Administration's latest annual long-term forecast, the "Annual Energy Outlook 2006."
Additionally, residential consumption of natural gas is projected to fall by 6 percent from 2005 levels this year but increase by 7.7 percent in 2007, the EIA says.
Energy conservation would help those cooling bills now and in the future. To help save energy:
* Put curtains on your windows to keep out the sun.
* Install a thermostat that will automatically adjust temperatures. Set it for 75 degrees in the summer when you are at home and raise it when you are out.
* Turn off lights, appliances and electrical equipment when not in use. Do your baking, washing, drying and ironing early in the morning or the evening.
* Clean or replace the filter for your air conditioner.
* Let dishes air dry in the dishwasher.
Costs related to natural gas consist of four main components: production, transmission, distribution and commodity price as determined by the marketplace.
When the gas is produced, it is transmitted over long distances by pipeline from the wellhead to a local gas company. Once at the gas company, it is stored and then distributed to local customers. The price of natural gas consumed is determined by supply, demand and other market conditions.
The Gulf of Mexico supplies 25 percent of domestic natural gas that is consumed in the U.S. But 11 percent of Gulf production is still blocked due to damage from Hurricanes Katrina and Rita.
Twenty-three percent of natural gas goes to home use and 27 percent goes to electricity generation. Companies like Mammoth Resource Partners Inc., a Kentucky-based oil and gas exploration company, are striving to put a dent in skyrocketing natural gas prices by tapping into the gas-rich Appalachian Basin.
"While people are facing ever-increasing energy costs, investors recognize that within these increases exists a greater investment potential," says Roger L. Cory, president of Mammoth Resource Partners.