FERC unveils a cautious summertime assessmentEnergy companies and utilities are gearing up for an unpredictable summer season after the Federal Energy Regulatory Commission released its Energy Market and Reliability Assessment this week. Its research focuses on possible areas of interest that could affect regional energy prices and service in the months ahead. What factors could drive energy prices for better or for worse?

Weather could affect energy prices more than last year

According to meteorological data gleaned by the organization with the help of the National Oceanic and Atmospheric Administration, this summer looks to be a balmy one, slightly warmer in certain parts of the country than in 2014. Energy use has a record of fluctuating with extreme weather conditions. The air conditioner, one of the biggest energy hogs, runs longer and with greater force when things warm up. Estimate that same figure at commercial and industrial scale and you’ll understand how a few degrees on the thermometer can compound energy demand. Ultimately, this could lead to supply issues if utilities are expected to meet unanticipated usage.

Scheduled pipeline maintenance could interrupt distribution

As the good people of New England are well aware, their limited access and heavy reliance on natural gas for both heating and electricity can hike up energy costs drastically in the wintertime. However, according to ISO New England Newswire, a national drop in the cost of natural gas between January 2014 and January 2015 helped the region save 60 percent on their energy bills this past winter than the one before.

However, plans to upgrade and expand the Algonquin natural gas pipeline this August could limit availability to New England residents, driving prices up. If your energy supplier generates electricity through natural gas, now might be a good time to switch to a fixed energy plan to prevent the risk of cost inflation.

Demand below supply, despite creeping on both ends

FERC predicts energy demand will grow by almost 3 percent this year over last as the US will likely receive more seasonable weather in the coming months. Additionally, national overall generation has dropped by the same amount. While the retiring coal plants – making up a majority of this loss – ease carbon emissions, grid reliance depends on this energy for baseload support. Though continued investments in sustainable energy like solar and wind will eventually make up the difference in piecemeal, the shrinking gap between supply and demand is definitely something to keep an eye on in the summer ahead.