When you step into a hot shower, light a burner to cook dinner or turn on the furnace in cold weather, you probably don’t think about where the natural gas that helps to make your life more comfortable comes from, especially during warm summer weather. For the employees of DTE Energy, though, thinking about supplying affordable, reliable natural gas to customers is a year-round job.
DTE’s gas supply purchasing and planning department is maintaining a steady supply of natural gas for customers by buying from sources across America. About two-thirds of the natural gas DTE customers use throughout the year is purchased during the summer, when demand and prices are lower, and then stored underground in naturally occurring rock formations.
It starts by market forecasters examining the current market for natural gas to determine where prices may be headed. DTE also uses past usage patterns, long-range weather forecasts and other data to determine how much gas is needed for homes and businesses throughout the year.
Once the forecasting is done, it falls to gas buyers like Mike Wiegand to find the right suppliers to provide the gas.
“We have about 40 suppliers we draw from,” Wiegand said. “We buy gas that comes out of Canada and from the Texas Panhandle and the Gulf of Mexico.” DTE also draws gas from new supplies in the Appalachian Mountains, and will begin receiving gas through the NEXUS pipeline once it goes into service later this year.
Once gas is purchased, it flows into DTE’s gas storage facilities. These depleted reservoirs, located deep underground, hold the gas until demand increases. Michigan’s geology makes it ideal for storing gas thanks to rock formations that previously held oil and gas which has been extracted.
Buying when demand is lower keeps the cost of natural gas, which is passed onto customers at no markup, from increasing unexpectedly. That means that the money the company saves when buying gas is money that stays in customers’ pockets.
Thanks to this storage, increased supplies of natural gas and employees like Wiegand, DTE customers have seen their cost for natural gas shrink by 30 percent over the last decade, and the addition of gas from the NEXUS pipeline should help that trend continue.