Unknown

I'm Shail Khan. I invest in early-stage companies at Energy Impact Partners. Welcome to Catalyst. So we spend so much time here, and I spend so much time in my daily life thinking about the constraints on the electricity grid that are being caused by all this load growth, thanks to data centers, et cetera, et cetera. You've heard this a hundred times. The direction of travel right now for many, many of these data centers, of course, is more natural gas generation. A lot of it in front of the meter being built by utilities or through utility tariffs, but increasingly also a bunch of it being built behind the meter to feed those data centers who are trying to connect directly into natural gas pipelines to deliver them the kind of reliability that they are used to, or at least something approaching it. And I realized that one thing that I haven't really spent a lot of time thinking about is we know the constraints on the power side, and why it's so hard to interconnect into the transmission system or even the distribution system in power. Is that also coming in the world of natural gas? Or is it easier there? In natural gas, in general, historically, it has been easier to build new pipelines. It is also easier to ramp production. So there's a number of reasons why natural gas shouldn't experience quite the same constraints that power has. But there's also a confounding factor in natural gas, which is that there's an even bigger, relatively new demand driver, LNG, in the United States, which is much, much bigger than demand is expected to be for data centers, at least for the next few years. So that's an additional lever on prices. It's an additional constraint on supply. And so I wanted to see whether we should be talking about natural gas constraints coming up in the same way that we talk about electricity constraints. For this one, I brought on Eric McGuire. He's the director of natural gas and LNG trading analytics at Woodback. He's coming up next. Demand flexibility is now an essential part of the data center speed to power playbook. But how do data centers actually curtail load? GridBeyond is the end-to-end solution for flexible energy management. GridBeyond's advanced DERMS and VPP platform is tailored to what data centers care about most, maximizing reliability, intelligently meeting curtailment obligations, reducing costs, and managing all your distributed resources. In one place. Ready to transform your distributed energy management? Get started at gridbeyond.com. Catalyst is brought to you by Antenna Group, the communications and marketing partner behind the most influential companies in energy, climate, and infrastructure. For three decades, Antenna has helped ambitious companies stand out, build market leadership, and become category-defining brands. From breakthrough startups to global industry leaders, their team brings the expertise, relationships, and track record to accelerate your momentum. Learn more at antennagroup.com. Learn about the flexibility platform for the modern grid at energyhub.com. Eric, welcome. Thanks for having me, Michelle. Thanks for doing this. I want to start with a basic question. I know exactly what it's like if you are trying to build a new generator on the power system or a new load on the power system, and you want to inject into or pull from the electric grid. I know how that works, the interconnection process. Let's focus on the load side of this. If you're trying to pull electricity, I know what that looks like. I actually don't really know what it looks like if you want to do the equivalent thing in the natural gas system. If you were trying to tap into a natural gas pipeline, what does that process look like today? How is that market structured? It depends on whether you already have the interconnect. The first thing, if you don't have an interconnect, is you need to talk to a pipeline about building a header system to tie into their interstate pipeline. If it already exists and you can already tap into that, then there's a whole other process. If you don't have an interconnect, then there's a whole process in terms of bidding on capacity, making sure that you do have the capacity you need to get the gas from the supply source to where you need it. There are mechanisms for that, for taking out long-term capacity on a pipeline. Does it look similar to electricity interconnection in the sense that, "Okay, if I want to interconnect to the grid, I need to go file an interconnection request with the utility in that case. They're going to run it through this queue with these study processes to determine whether there is capacity on the grid. Eventually, they'll tell me, one, whether there is capacity, two, when they can deliver to me, and three, what upgrades I need to pay for in order to interconnect." Is it similar to that or does it work differently? It is similar to that, but it depends on what scale you're talking about. If you just are tying into a header system, that's a much smaller thing. But if you're trying to pull a very large volume across an area that there isn't the capacity to move that kind of volume, then you're going to start dealing with much more regulatory and environmental scrutiny. Let's presume you're a data center. Let's say you are hundreds of megawatts and you are putting enough capacity behind them, enough natural gas capacity behind the meter to fully meet your load for some period of time. I would presume that is enough that you're on the big side and you're pulling just from the header. We've seen that already with the LNG market. The LNG market has grown exponentially over the last several years. We've seen, even particularly just in Texas, there have been a large number of intrastate pipelines that have come online flowing from Western Texas into the Gulf from the Permian to bring that supply across to where it's needed. And so with every single one of those projects, and we can talk some about how long it takes from Boundfield to Greenfield and what kind is possible, it can take anywhere from eight months to six years, depending on what you want to get done. Eight months to six years. I mean, that range is actually short when I think of it in an electricity interconnection context. Well, which I guess is the point, right? That's why people are doing it, because it's faster. I think it's faster. It faces less regulatory scrutiny. You're not pulling from the grid. And so even if you look at the moratorium in Texas right now on data centers, it's the in front of the meter data centers that there's a moratorium on, but the behind the meter data centers are still progressing. Are we, this is going to be a location-specific answer, right? That's a very specific answer, I'm sure. But at the high level, are we in a period of capacity constraint in the natural gas pipeline system? Or is it right now the case that it is getting harder and harder to find new places to interconnect quickly? Or is there still enough excess capacity that we're not approaching that? I think we've been in a point of constraint for some time. I mean, the natural gas market has almost doubled in the last 10 years. And you look at how much production is up. You look at how much LNG demand is up. But the question has been, how can you get enough supply to the LNG facilities? Now we're facing the question of, how can you get the supply to the data centers as well? And so between both LNG and data centers, we're expecting a huge amount of demand growth over the next several years. And the question is, how do we keep up with that? Now, there's lots of pipeline expansions that have been proposed. But then we have to sort through those and determine what are realistic, how long to get to the market. And at some point, do you have to start rethinking about or rethinking where you're putting these data centers or where you're putting this demand to remove some of those constraints? Before we, I guess we move on from the like, how are the contracts structured? Is it generally, if I'm okay, again, I'm a data center and I'm going to build behind the meter turbines or natural gas engines or whatever it is. And I'm going to tap into a header natural gas pipeline. Is my contract generally structured as like, here is my expected annual capacity that I need, and I'm guaranteed that amount? Are there, do you get curtailed ever in weather events? Like, is it, how does that work? So let's take the big example. So if you need a very large amount of supply from a pipeline, then you're probably looking at a large expansion to a pipeline or a new pipeline altogether. If you're doing that, then the pipeline is going to ask you to be a backbone shipper. Yeah. And to essentially commit to 10 plus years of capacity that you need. If you do that, then there's a few different ways you structure it, but essentially you'll pay a reservation fee that is a use it or lose it. You know, you pay that fee, whether or not you flow the gas, the pipeline knows that it's going to get its revenue. Then I guess that's the first question. So how do you structure that contract? If it's an already established pipeline, then your contract might be three-year term instead of 10-year term. But if you're building a data center, I would want to secure that supply for as long as I can. And so I'd be looking at that longer 10-year term kind of contract. Then there's a question about priority. So when you take out capacity in a pipeline, usually when you have that use it or lose it contract, you're paying that reservation fee and that gives you the highest ranking to be able to flow on the pipeline. So there's firm transportation, there's interruptible transportation, there's all these different ranks. Even within firm, you could be primary within PaaS, meaning that the PaaS that you paid the pipeline for, you're flowing from point A to point B, just like you said you would. If you decide to flow and take receipt at a different location, and that drops your priority a bit and then lowers you in terms of the rankings for cuts. But overall, so there's this large kind of ranking structure that prioritizes how gas flows. And that's pretty standard and that's not a big risk during normal flow conditions. However, you mentioned cold weather. When major events happen, let's say there's a force majeure event right now, there's a major force majeure event in the Northeast going on and the pipeline loses half of its capacity. Well, in that case, if you're flowing interruptible, you're probably going to get 100% cut. And even the people with a firm capacity are going to get cut because the pipeline isn't running at max capacity. And so that's in a force majeure event. Then you have cold weather events. Now, cold weather events won't necessarily impact pipeline capacity. But what happens in cold weather events that people forget about is we get freeze-offs. And so when it gets really cold, particularly in the Permian or in the South, you get condensate at the wellhead's freeze-off and you lose production. So during winter storm Fern this past winter, we had almost 18 BCF a day of freeze-offs across the entire US. And think that you're in a market where you only have 110 BCF of production. So this is a huge amount of supply that got pulled off of the grid. So we think about cold events, we generally think, what is the demand impact? And is there going to be this demand on demand? And competition? But we also have to realize, we're thinking about security of supply, that during these cold weather events, the market loses a huge amount of supply too. And so I think winter storm Fern in January, off the top of my head, I think it was a 350 BCF event. 120 BCF of that was supply loss. And then what's that called? 220 BCF was demand gain. I don't know if you have these numbers off the top of your head, but I'm curious, given those couple of reasons why, you might lose supply if you're on the load side. Like on average, what is the uptime? What's the reliability if you are a consumer? And the reason I ask is because again, in like the data center context, right? What's the general expectation is three nines or five nines of reliability. And to get there historically, it's like electricity plus backup power. The electricity grid, you know, has its outages too, but it's generally pretty good. You don't get that much of an outage in natural gas pipeline. Do you get more or less than electricity? I mean, in general pipeline reliability is really, really good. Now you'll find different pipelines and different compressor stations are better than others. But my first job was bidding on pipeline capacity as a junior trader. And I would then assess that downtime pipeline by pipeline when I bid on it. And then when I bid on the capacity, I would then take them to account and assuming a certain number of days, you know, you know, you know, you know, you know, you know, you know, you know, you know, The problem is when you're dealing with something this size, when you're talking about data centers and reliability, even if you're only down for three days in the entire year, I mean, that could be a pretty big impact. And you then have to make sure you either you have to think about that in terms of the compute that you're then leasing out or that you're selling, or you need to think about alternative energy sources. Yeah, that's where I think, you know, I've heard talk of a bunch of the new data centers that are doing this. They're doing behind the meter bridge power with natural gas, not also installing backup generators like diesel generators. And I, they, they must be willing to withstand, I mean, you know, three days a year would be roughly 99%. Yeah. With, with no additional nines, which is definitely not the historical norm for how data centers look. Yeah. You mentioned LNG a little while ago. I'm curious, the extent to which we are starting to see real competition for supply between LNG, LNG and large loads. I mean, I think, I think it's definitely what's happening. I think LNG, right, it is, we're exporting, I think somewhere around 19 BCF a day right now, which is absolutely enormous. Again, I think in the context of the natural gas market, I'm going to roughly round it down to 110 BCF a day. You have, let's round LNG up 20 BCF a day of LNG demand, right? That's absolutely enormous. We're looking at some of the analysis we've done recently of up to, to five BCF a day of behind the meter gas demand coming up over the next five years. So it's not nearly as big as LNG, but what you have to remember with both of these is these are baseload demand, right? They're not going to swing a whole lot, at least right now, based on prices and kind of they're all in the money. They're not going to swing a whole lot with temperatures. So a lot of the demand in the natural gas markets historically been tied to temperature. So when it's cold in the winter, you get more heating demand. When it's hot in the summer, you get air con demand. You have a lot of seasonality, low demand in the shoulders, but essentially both data centers and LNG are going to be competing for baseload demand. And then everyone else is that marginal demand on top of that. And are we seeing that affect prices on a, on a locational basis? So I mean, we've definitely seen it in terms of Henry hub on LNG. So if we think about the structure of the market, the majority of us natural gas production used to be in the Gulf. And what would happen is everything would flow into, to this tiny little location in Southeast Louisiana called Henry hub. And then it would flow out from there. And so the way the natural gas market trades is when we think about natural gas prices, we actually use Henry hub as the kind of national balancing point for the U S and historically what happened was Henry hub was one price. And then all the regional prices traded as a premium to Henry hub. So everything else was pot was a positive spread. If you're looking at spreads now, Henry hub compared to a lot of these locations, Henry hub is the premium price. And a lot of these locations are trading at a discount to Henry hub because the production's moved out of the Gulf. It's now in west Texas, it's in Colorado, it's in Marcellus region, Northeast. And that gas is actually flowing back down to Henry hub. So with the growth of LNG, we've definitely seen that. We've now seen that Henry hub is a premium location. Now there are other locations. You get your extreme market locations like the Northeast, new England, California. Those are still, they're still premiums to Henry hub but all the other regions are now, we're seeing a shift to being discounts to Henry hub. Interesting. Let's talk about building new pipelines. I mean, you know, again, the reason why all this behind the meter stuff is happening to data centers is in part because it's hard to interconnect to the electricity system increasingly, but also because it's really, really hard to build new transmission lines. Historically, it's been a lot easier to build new natural gas pipelines. Has that changed? Is it? And where is it easy? Where is it not easy? I depends on where you look. And so in our analysis recently, I just mentioned, you know, we looked at Brownfield pipelines and then Greenfield kind of developments and in the Brownfield areas where you're building on kind of capacity, it's already there. It's eight months to get it up and running in some areas, particularly if you look at mountain Valley pipeline in the Northeast, that took a very long time because you're dealing with environmental regulations. You're crossing a lot, more states when you're out there, when you're dealing just with Texas is a lot easier. And so I would say in general in the South, we see that is easier to development develop new pipelines than it is in the Northeast. But then you also have the incentive of right now, Permian in West Texas, one of the fastest growing producing regions in the entire United States. And we're actually seeing a bit of a slowdown in Marcellus. And so when you think about areas that you want to build in, um, Permian becomes really attractive because of the abundant supply because of how quickly some of these new pipelines have come online even this year. And then you also remember that beginning of this year, Permian gas prices were actually negative on a fixed price. So what happened was oil prices got so high and a lot of the production, it's oil production out there that people are making enough on their oil production that they were actually paying people to take away their natural gas production because the natural gas was constrained. Now that's flipped around. Now these export pipelines have come online and it's getting out to the Gulf. Um, but between pricing and ability to build pipeline interconnects, uh, Texas is attractive for data centers. 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Utilities target, shape, and verify capacity down to the meter. Unlock flexible capacity that costs 40 to 60 percent less to deploy than traditional infrastructure in a fraction of the time it takes you to break ground on a peaker plant. Learn more at energyhub.com. Right, and so back to the data center point, we've got a gigantic pipeline of data centers in West California, and we've got a massive pipeline of data centers in the United States. And so, from a natural gas supply perspective for those data centers, that's probably the right place to put it. Actually, it might be the easiest place to get new capacity for some period of time. Is that right? Yeah, and then your question about building interconnects and then building new pipelines, it kind of comes back to that question of getting a new pipeline built is not necessarily easy, depending on how long the pipeline is, how many states you have to cross, how many different, you know, populated regions you have to go through. Now, if you go out to a region that's not very high, that's not highly populated, that you don't have to build a long pipeline to connect to your supply, suddenly things get a whole lot easier. All of your regulatory approvals, your environmental approvals, there's just a lot less hoops you have to jump through if you're out in some of these producing regions. Back to the like, I guess the bigger picture of is the rise of behind the meter, or actually, honestly, the rise of natural gas generation in general as a result of load growth, not all of it is going to be behind the meter. Like, is it going to meaningfully affect natural gas supply? Is it going, is natural gas pipeline capacity going to meaningfully be a constraint? I mean, you know, if you said we're doing 120 BCF and you think maybe there's five BCF coming from behind the meter, that sounds meaningful, but not shaping. Is that about right? I mean, it's meaningful, but you have to look at it in context also of the growing LNG. We still have a lot of LNG. We don't have a lot of new LNG export capacity come on next year, but it's going to continue to grow over the next decade. We're going to see this data center demand growth ramp up. And so it is going to be meaningful. It already has been meaningful and it will be meaningful. And we've already seen pipeline constraints. I was constrained earlier. And so gas was trading at a negative fixed price, right? Producers are paying people to take their gas. Right now in the Northeast, we're seeing Northeast gas prices trade under a dollar. And we're seeing what looks like production shut-ins because there is not enough capacity to get that gas out in the short term as demand has dropped. Right now, people are shutting in gas because it's oversupplied. So you already are seeing supply constraints all over the U.S. Yeah, it's interesting. That's so different from the electricity kind. I mean, I guess it's not, right? Like we see curtailment in electricity when you have oversupply and it's an insufficient demand or insufficient interconnection capacity, I guess. But is the expectation that you'll see, like, because of the rise behind the meter, in combination with a number of other factors, data centers are moving closer to where the energy is. So would you expect, then, to see a big boom in data center development in the Permian, for example? Like, if you're closer to the supply, does that make the pipeline constraint easier? Because you're not building, yeah. Yeah. I mean, one of the things that makes it easier, and again, it puts you closer to the supply. It helps you avoid a lot of the constraints. It removes the demand-on-demand competition. I mean, not that you would, but if you put a data center in the Gulf, then you're competing on those long-haul pipelines. So, yeah, it's a big boom in data center development in the same capacity that LNG facilities are. If you're sitting there right in the middle of the Permian, you're not doing that. And so I think that you will see data centers. And we've already kind of, that's what we're doing in the risking of these new proposed data centers. We have almost, I think it's over 900 gigawatts of proposed data centers. But when we risk assess them, the number that we think are going to come to market are significantly less than that. But the ones that we think are the highly likely ones are the ones that are in the basins. Yeah, that's interesting. What is your outlook on pricing for natural gas, given all of this? Clearly, we have a rising demand environment through a combination of LNG and this load growth, this electricity load growth. And you tell me what will happen is happening with production, but is the expectation we'll see rising prices? I mean, what we've seen so far, so we've seen, again, the natural gas markets doubled in the right now we're sitting, we hit a high, I think about 112 recently, 113 BCF a day of production. So it's just about, I guess, not quite double. It's increased significantly. But what we've seen in that time is demand has increased, that supply has rose to meet it. And so what's been really interesting, the shift in the market is that it's grown exponentially. And so supply has kept up. And we used to, as a market, be really scared of running out of gas. We're actually not really scared of running out of gas. And so for traders out there, they generally look at their March-April spread. And the March-April spread represents the fear that you're going to run out of gas at the end of winter. And so that used to be, I mean, it's called the widowmaker. And it used to blow out and you get really wide spreads. The March-April spread, I think, is 10 cents right now for this coming for March-April 27. So the market's sending the signal, they're not scared of running out of gas. But you get a lot of fear of running out of gas in January and February. And so the new spread is that January to March or the February to March spread. Because what's happened is the market has grown, storage capacity hasn't grown. And so I think the big thing that we're going to see is, especially if a lot of this demand is located in producing regions, that you'll see production rise to meet it. Because with break-evens where they are, there's plenty of incentive to continue to demand that's growing there. But I think you're going to continue to see an issue in terms of deliverability in those peak months. And so who's going to get the gas when it's really cold? What happens when production drops off? And you have data centers, and you have LNG, and then you have everyone else calling on gas for heating. What happens in those events? So I think, and just me speaking personally, we probably see some support for pricing going forward right now. The international European gas prices and US gas prices is really wide. And so as you get new LNG export capacity coming online, you would expect that spread to narrow. And so we do expect a lot of new LNG to come online. But historically, what we've seen is as gas prices go up, producers step in and happily take that premium to produce more gas. That's interesting on storage capacity. So like the, okay, again, assume that you're going to get a bunch of new demand in producing regions. That implies it's not, I mean, there will need to be some new pipeline capacity to serve those loads, but it's not big, long pipelines. In terms of miles, they won't have to be that long. However, you would need a lot of new storage capacity in those regions as well. Is it hard to build new storage? It is something we have not seen a lot of. I mean, there's multiple kinds of storage you have, but a lot of times it's depleted reservoir storage. So it's hard to build new storage. that are being used then and pumped back full of gas, then pulled back out. And so what you'd need those, you'd need those spreads to justify the investment in it. And so right now, you know, relatively low prices. I think you do have, you're getting those wider storage spreads. So I think we're seeing new projects come online and be proposed. But then the question is in that high winter, if the data center wants reliability and, you know, the local cities, city gates, utilities and need that gas and max heating season, you're going to have to pull on something. And so right now, what the market would tell you based on pricing is that there will be peak days in the winter and that we don't have enough supply to meet peak demand already. We're not scared of running out of gas by the end of winter, but they're going to be peak days where gas prices go crazy. So let's look at this past winter when winter storm burn hit, Henry Hub had a high print. I think Henry Hub had a high print close to $50 in MMB2, 5-0. And at the end of the year, average that day, $30 in MMB2. And Permian, I think got to a high of $17 or $18 in MMB2 before then trading negative in the coming months. And so you can see there's going to be, there's a whole lot of volatility on the day in those peak winter days when the peak demand hits. It doesn't mean that we're going to have, and so that's kind of, I think what we're going to see of more going forward as this demand grows, I'm not necessarily super bullish outright price. I think it'll increase some, but I don't know. I don't think we're going to go back to the $10 natural gas days when I started trading years ago. But I think that what you will see is you'll see a lot more volatility in the market. So I think the story is volatility. It's not high prices. It's how do you manage a volatility on the day. Does LNG, do LNG, the buyers who are going to produce LNG, do they ramp up and down their purchases based on price? Like on those days, do you see demand pull back? Because I know data centers won't, right? They're price insensitive here. So on the LNG side, I think we've only seen LNG shut-ins. So what you're saying, are LNG shippers going to turn down their supply and order on those high price days? Well, first off, let's talk about an LNG contract. These are long-term contracts, right? They're doing 10-year, 15-year SPAs. These aren't day-to-day contracts, and they're going to meet demand elsewhere. A lot of these contracts, also the LNG market, it's not quite as commoditized as well. So what we see in natural gas and oil, even though LNG is essentially just transport for natural gas, these contracts are bilateral contracts. And so if I'm going to sit here and strand a contract, one, I'm stranding back gas that has to be delivered someplace else in another country 15 to 30 days from now. And then I need some way, I need to pick up the phone, call that person. It's not like I can do with oil and gas on the screen and just click a button and unwind it. So it's a bit harder to unwind those contracts. So I think we've really only seen LNG shut-ins once, and that was back in COVID. And essentially what happened was the entire world was oversupplied. We saw the Asian market, JKM, go flat to TTF. And then we saw TTF go flat to Henry Hub. But LNG didn't start getting shut-in when your transport economics were closed. And so it costs a certain amount to ship it. And so when TTF got within a certain. Dollar range of Henry Hub, we didn't see any shut-ins. It wasn't until TTF went flat. Now, once that European price went flat to Henry Hub, then we saw LNG shut-ins. I think it's the only time we've seen LNG shippers really economically turn off gas, but it was very fundamentally driven. We do see LNG exports decrease when we see these large cold snaps. But what's really interesting, if you look at the profile of the LNG exports, and you look at the profile of the freeze-offs that are happening, they're right on top of each other. They have very high correlation. So my view is that what we're seeing in the short-term events, one, I think they happen so quickly, it's difficult to take advantage of economically as a shipper. But what I think is happening is we're actually seeing security supply losses, where that production disappears for a few days, and that impacts what's being exported over those same days. All right. So I guess to wrap it up, stepping back for a second, let me tell you my takeaway here, and you can tell me if this seems right to you. In the electricity world right now, the rise of data centers is like the biggest thing that's ever happened. You know, we haven't seen this kind of load growth over this period of time since the 1950s. Everybody's scrambling and trying to figure out what to do with it. It's a huge deal. In the natural gas world, you know, it seems meaningful for a percent-ish, for behind the meter alone, for the next five years, right? Five out of 120, roughly. That seems meaningful. But actually, two things seem different. One is you have an even bigger factor, which is LNG, which is a bigger demand driver today and has been a bigger demand driver. And it sounds like you think we'll continue to be a bigger demand driver. And two, it seems the natural gas structural market is better able to ramp. You can probably build new pipelines easier, you can ramp up supply faster, production faster. And so, my read is that what you're telling me is that, like, it's a meaningful factor in the context of the natural gas market, but it's not quite as earth-shattering as it is in the electricity sector. Does that resonate? I don't know. I mean, I think maybe I've done data centers a disservice in the ramp-up because just, I mean, pure numbers, LNG is bigger. And so, in that context, LNG is bigger. But what we're talking about is this marginal demand unit and anyone who's traded before knows that the market prices off the marginal demand. It doesn't price off the base load, right? And so, I think that this is going to be a big issue. And so, I mentioned we're already seeing constraints throughout the US market. In fact, I don't think the US market really trades as one market anymore. It trades as lots of regional markets in the gas market, more similarly to how power trades. I think we're going to see more and more of a shift that way. And so, I think we're going to see more disconnects in regional pricing like perm, you know, was trading negative. Like right now, you're seeing shut-ins in the Northeast. And I think that the data center demand, where it hits, is going to be revolutionary for those regions, right? I mean, you suddenly drop a huge amount of demand in the middle of the Permian with data centers, then all the LNG facilities are going to be saying, "Well, okay, now where do we get our supply?" So, same with Northeast. Northeast, you drop a whole bunch of data centers right there in kind of Western Pennsylvania. And then you're going to have outlet for supply there, and you're going to have demand competition. And a lot of that gas is flowing to Boston or New York in the winter, right? So, what happens there? And so, I think it will have a huge impact on the markets because what we're talking about is the marginal demand molecule. And it'll especially have a huge impact in the winter, when suddenly all this baseload demand is competing with, you know, the grandmas and the grandpas and the kids and everyone else in all these populated cities who need the gas to heat their homes. And so, I think it'll be a big question of then how does that balance happen in those peak demand periods? All right, Eric, super informative. Really appreciate your time. Thanks for joining. Thanks, Joe. Appreciate it. Eric McGuire is the Director of Natural Gas and LNG Trading Analytics at Woodmac. This show is a production of Latitude Media. You can head over to latitudemedia.com for links to today's topics. This episode is produced by Max Savage-Levinson. Mixing and theme song by Sean Marquand. Anne Bailey edits the video version of the show. Stephen Lacey is our Executive Editor. All of our episodes are on YouTube. Subscribe to Latitude Media for episodes of this show and Open Circuit. 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