Natural gas is an important fuel and a raw material in manufacturing.
Natural Gas: A Fuel and a Raw Material
Natural gas is used in an amazing number of ways. Although it is widely seen as a cooking and heating fuel in most US households, natural gas has many other energy and raw material uses that are a surprise to most people who learn about them.
In the United States, most natural gas is burned as a fuel. In 2011 about 25% of the energy
consumed across the nation was obtained from natural gas (1). It was used to generate electricity,
heat buildings, fuel vehicles, heat water, bake foods, power industrial furnaces, and even run air conditioners!
22 Trillion Cubic Feet
During 2009 the United States consumed about 22.8 trillion cubic feet of natural gas. That's enough gas to
fill a room with a footprint the size of Pennsylvania and about 18 feet high. Most of that gas was delivered to nearly 70
million homes and places of business through more than a million miles of natural gas pipelines (2).
Uses of Natural Gas in US Homes
Over one-half of the homes in the United States are supplied with natural gas. About 19% of the natural gas consumed
in the United States during 2011 went to homes (1). This gas is delivered to homes through pipelines or in tanks as CNG
(compressed natural gas). Most of the natural gas consumed in homes is used for space heating
and water heating. It is also used in stoves, ovens, clothes dryers, lighting fixtures and other appliances.
Residential and commercial demand for natural gas is highest in the winter when people burn gas to heat their homes and businesses. Since few people cool their home or business in summer with natural gas air conditioners the summer demand is much lower. Image by U.S. Energy Information Administration.
Uses of Natural Gas in Commercial Buildings
In 2009 about 14% of the natural gas consumed in the United States went to commercial buildings. The use of
natural gas in commercial buildings is similar to its use in residences.
It is used mainly for space heating, water heating and sometimes for air conditioning.
Electric Power Generation
The electric power industry was the largest consumer of natural gas in the United States during 2009. About 30% of
natural gas consumption was used to make electricity.
Of the three fossil fuels used for electric power
generation (coal, oil, natural gas), natural gas emits the least carbon dioxide per unit of energy produced.
It emits 30% less carbon dioxide than burning oil and 45% less carbon dioxide than burning coal. Burning natural gas also
releases lower amounts of nitrogen oxides, sulfur dioxide, particulates and mercury when compared to coal and
As the United States becomes more concerned about climate change, carbon dioxide emissions, and air quality,
the use of natural gas for electricity generation is expected to increase.
Demand for natural gas by the electric power industry in the United States peaks in the summer when homes and businesses are using air conditioning. Since very few homes and businesses have natural gas air conditioners the demand goes to electricity. Image by U.S. Energy Information Administration.
Industrial Uses of Natural Gas
Natural gas is used in a wide variety of manufacturing processes. About 27% of the 2009 consumption of natural gas in
the United States was by industry. Natural gas is used as both a raw material and as a source of heat.
is an ingredient used to make fertilizer, antifreeze, plastics, pharmaceuticals and fabrics. It is also used to manufacture a wide range
of chemicals such as ammonia, methanol, butane, ethane, propane and acetic acid.
Many manufacturing processes require heat to melt, dry, bake or glaze a product. Natural gas is used as a heat source in making glass, steel, cement, bricks,
ceramics, tile, paper, food products and many other commodities. Natural gas is also used at many industrial facilities for incineration.
Oil & Gas and Pipeline Industry Use
Companies that produce and transport natural gas are also consumers. Transporting natural gas through pipelines
requires compression stations to keep the gas pressurized and flowing through the pipeline. Many of these
compression stations use natural gas as a fuel. Many oil refineries use natural gas for heating and power generation.
Natural Gas as a Vehicle Fuel
Natural gas has an enormous potential for increased use as a vehicle fuel. The main barriers to
this have been the short range of the vehicles, limited refueling options, and slow refueling times.
However, over the past few years refueling station prices have dropped to just a few hundred dollars and
these can be placed in residences where the vehicles can be refueled overnight or between trips.
Since about half of all residences in the United States are supplied with natural gas the potential
to increase the number of natural gas vehicles on the road is very high. In addition, the discovery
of natural gas in shale deposits around the country has increased the availability of
gas and decreased the price.
Natural gas has significant advantages over gasoline and diesel fuel. Natural gas vehicles emit
60-90% less smog-producing pollutants and 30-40% less greenhouse gas emissions. It also costs
less per mile to operate a natural gas vehicle compared to a gasoline or diesel vehicle (4). And,
natural gas is produced locally instead of imported.
The United States government has done many cooperative studies with businesses, local governments and public agencies related to the use of natural gas as a fleet vehicle fuel. The results of these studies have overwhelmingly favored natural gas. Summaries of these studies and many full reports can be downloaded from the U.S. Department of Energy website (5).
(1) United States Energy Information Administration (2010). Natural Gas Monthly, February 2010. eia.gov. URL
(2) Natural Gas Association (2004). Natural Gas Distribution. NaturalGas.org. URL
(3) Natural Gas Association (2004). Natural Gas and the Environment. NaturalGas.org. URL
(4) United States Department of Energy (2010). Natural Gas Vehicles. FuelEconomy.gov. URL
(5) United States Department of Energy (2003). Alternative Fuels - Fleet Applications. afdc.energy.gov. URL
Natural Gas Use - United States, 2011
Electric power generation, industry, residences and commercial buildings were the major natural gas consuming sectors in the United States during 2011. Image by the United States Energy Information Administration, Natural Gas Monthly for February 2012.
Learn about the uses of natural gas in a residential setting in this video by UGI Utilities, a natural gas and electricity utility in Reading, Pennsylvania.
Natural gas prices fluctuate over time. Wellhead prices are determined by supply, demand, and general economic conditions. Prices to consumers are determined by similar factors. Image by U.S. Energy Information Administration.
Average Residential Natural Gas Prices
The price of natural gas is not uniform across the United States. Instead, the price is determined by supply, demand, proximity to supply, regulatory environments and the cost of natural gas that is flowing in the local distribution system. Historically, people along the east coast have paid some of the highest prices. This may change as new unconventional resources such as the Marcellus Shale are developed and as more LNG arrives from low-cost producers. Image by Geology.com using natural gas price data for calendar year 2008 from the United States Energy Information Administration.