Measuring the influence of Canadian carbon stabilization programs on natural gas exports to the United States via a 'bottom-up' intertemporal spatial price equilibrium model

Abstract In this paper, we present the results of a study of the impact of Canadian carbon stabilization programs on exports of natural gas to the United States. This work was based on a study conducted for the US Environmental Protection Agency. The Gas Systems Analysis model (GSAM), developed by ICF Consulting for the US Department of Energy, was used to gauge the overall impact of the stabilization programs on the North American natural gas market. GSAM is an intertemporal, spatial price equilibrium (SPE) type model of the North American natural gas system. Salient features of this model include characterization of over 17 000 gas production reservoirs with explicit reservoir-level geologic and economic information used to build up the supply side of the market. On the demand side, four sectors — residential, commercial, industrial and electric power generation — are characterized in the model. Lastly, both above and below ground storage facilities as well as a comprehensive pipeline network are used with the supply and demand side characterizations to arrive at estimates of market equilibrium prices and quantities and flows.