Comparing today's environment to the post-2010 shale cycle, how much of the demand reaching your members is firm enough now to underwrite 10 or 15-year contracts?
We believe the demand is real, and I point to three data points to describe why. The first is anecdotal. Our members are reporting that they're seeing more proactive outreach from potential customers for pipelines than they've seen since 2008, since the shale revolution. The second is what we're seeing at FERC, the main regulator for natural gas pipelines. To build a pipeline you need a certificate of public convenience and necessity from FERC to proceed. In 2025, FERC approved 16 natural gas pipeline or compression-related certificates, equating to roughly 3.6 BCF a day of additional gas. As of today, May 8th, there are 30 pipeline and compression certificates pending at FERC, 24 filed and six in pre-filing. If those all proceed, it would be an additional 16 BCF a day at a minimum, and the reason I say minimum is because some pre-filing projects don't have specific volume numbers yet. On top of that, there are also storage and LNG projects pending. Demand is now showing up in actual project applications, which is a real marker.
The third data point comes from the INGAA Foundation's North American Midstream Infrastructure Report, released in March. We modelled demand and the infrastructure needed to meet it over a 25-year horizon, with the research done by a consortium including the University of Houston, Wood and ESMIA Consultants. The reference case showed an increase of 44 percent in electricity generation from all sources, including gas, over the next 25 years. The low-carbon solution scenario showed an increase of 55 percent. Three different data points, all pointing to the fact that demand is real. The main drivers, which are highlighted in the report, are increased need for electricity from greater electrification, a lot of which is coming from data centers but not all of it. Some of our member companies, particularly in the southeast, note that demand for electricity is up in general. The broader push over the last five years for electrification in homes and vehicles is driving demand at large. And on the pure natural gas front, we're also seeing demand for more LNG exports.
On permitting, what does meaningful reform look like in legislative text rather than executive order, and where is the realistic ceiling in this Congress?
Meaningful permitting reform needs to do three main things. First, it has to address NEPA. You could argue that the Supreme Court already addressed NEPA in the Seven County decision. That decision was very good because it narrowed the scope of environmental reviews so that analyses now focus on the direct impacts of the infrastructure being built, and it provided greater deference to the agencies. We've already seen this help FERC move more quickly through environmental analysis. But on statutory changes, we believe the Seven County decision should be codified into law. Second, the Clean Water Act certifications need to be addressed. A natural gas pipeline gets its FERC certificate but still needs its state water quality certification under Section 401, and we've seen many states use that process to slow down infrastructure development. Legislation must clarify the scope of review so that the analysis focuses only on impacts directly arising from point source discharges, not the activity as a whole.
Third, we have to decrease litigation risk. Increased opposition to pipeline projects has manifested in legal challenges at every step of the permitting process, and there are a number of judicial reforms that would help. You can clarify the scope of judicial review, require clear and convincing evidence to overturn an agency's permit, or change the structure so that a court can only remand a permit back to an agency rather than vacating it. We think that's a really important change. You could also shorten timelines for an agency to act after a federal court remands a permit. A number of things in the judicial reform space, if put into statute, could help overall permitting reform.
With Seven Counties and a more permissive FERC, is there now a credible path to new Northeast takeaway capacity, or have past scars made members more cautious regardless of regulatory weather?
I don't think Seven County alone changes the dynamics in the Northeast. What changes the dynamics in the Northeast is that any time there's a winter storm event, the region faces significant energy constraints. That plays out in fear and concern about people not being able to get enough energy, particularly natural gas, and you then see very significant price spikes. Change will come in the Northeast when politicians respond to political pressure from their constituents about lack of energy and rising costs.
On capital markets and the scale of investment the INGAA Foundation report describes, I do think there is still a lot of potential capital available for infrastructure, and if Congress actually passed a permitting reform bill you would see additional capital unlocked. The capital is there, but some of it is still sitting on the sidelines because there's real concern about the ability to build these projects in a timely manner without cost overruns. Mountain Valley Pipeline (MVP) is the poster child to scare away potential investors. But there's so much demand for more energy, and so much demand for natural gas, that there is still a lot of potential capital ready to be deployed.
When members make a final investment decision today on a 30-year asset, what assumptions about the 2040 and 2050 energy mix are baked into the underwriting?
It's interesting that you say 30-year asset, because much of the existing natural gas pipeline in this country is actually 50 or 60 years old. The pipe in the ground today, much of it is 50+ years old, so these are absolutely long-life assets, and that's why building them requires significant investment. Our members have historically gotten 20-year contracts when looking to build a pipeline, for the reasons you articulated, it's a lot of capital, it's long-life infrastructure. They're looking at the demand, and the demand in this country for energy and natural gas is not waning.
Some of the global dynamics we're seeing, including what's happening with the conflict in Iran, drive home the fact that we have an abundant natural resource in this country with natural gas that helps our national security and our energy security. The price of gas has been rising around the world but staying flat here in the United States since the start of the conflict, and that gives confidence to pipeline operators and developers. We have energy demand, we have an abundant resource, and if we have the infrastructure to move that resource around the country, it helps our overall national security.
How does the US balance the strategic imperative to supply allies in Europe and Asia against the domestic pressure to keep prices low for industry and consumers? At some point, do those three things, domestic, exports, and the new data center load, compete for the same molecule?
If you look at the historical price of natural gas in this country, based off Henry Hub, the main trading market for gas, the price has stayed relatively flat over the last 20 years. During that same period, the United States went from just starting to export gas to being the world's largest natural gas exporter. We went from zero to hero without changing the domestic price of gas, and we have that story because we have such abundant supply. Our domestic price fluctuations are not because of a lack of supply, they're because of infrastructure constraints. Areas of the country with robust infrastructure have lower overall energy prices, and infrastructure-constrained areas pay higher prices. The U.S. Chamber put out a recent analysis based on publicly available data that maps US electricity prices and details exactly how the states with a lot of infrastructure have much lower prices.
On the question of whether domestic demand, exports and data centers eventually compete for the same gas, it's a very valid point. What I can go on right now is historical data, which hasn't proven out that conflict yet, but over the next 20-year horizon we're going to see improvements in technology and greater innovation. It's not going to remain static as it is today. If anything, it's an argument to increase investment. We also saw a really interesting example during Winter Storm Fern, where US LNG export terminals demonstrated amazing operational flexibility, reducing their feed gas intakes by approximately 44 percent at the height of the storm to redirect volumes back into domestic markets. Not* all LNG exporters have that flexibility, but some do, and it shows that exports and domestic supply are not always in tension.
Synthesizing all of this, where does natural gas sit in American grand strategy over the next decade, transition fuel, permanent backbone of industrial competitiveness, or geopolitical lever?
Natural gas is foundational to the US economy long term. Our overall energy system is going to continue to expand, demand is expanding, and over time it will be met with greater innovation. My members are very supportive of an all-of-the-above strategy, but for the foreseeable future an all-of-the-above strategy includes natural gas as reliable baseload power. We know that data centers require the kind of reliability that only certain fuels can deliver. Yes, coal can deliver, yes, nuclear can deliver, but there are a lot of advantages that natural gas has over those other fuel sources.
Then there's the abundant supply we have and the differentiator that natural gas provides to the United States from a security perspective.
Energy ends up being the first approximately five percent of the economy, but the rest of the economy doesn't function without energy, and natural gas is foundational to that.
There's also a global dimension. A lot of this world is still developing, and its development is not going to go through the same process the United States went through. It's going to be accelerated by the technologies and fuel sources available today, and natural gas has the ability to rapidly accelerate development and progress in a lot of underdeveloped countries. So it's an argument for exports, but it's also an argument for progress around the world. I believe there's a long-life future for anyone in the natural gas business.
*Report: Holding the Line: U.S. Natural Gas Performance During Winter Storm Fern | Natural Gas Council
