 So we're finally at the point. We're going to deliver the gas to end users in this particular presentation We'll go through the various types of end users. So finally, we've gathered it processed it Transported it may or may not have stored it. We were finally going to get to the burner tip So we are at the distribution point that is where the gas is distributed to multiple end users I've mentioned a couple of times the Term LDC is local distribution company. These are your actual gas companies Their primary operations distribute low-pressure gas We mentioned that the transmission pipeline system is operating anywhere from 200 to 1500 pounds per square inch You can't have that type of pressure coming into your home for your hot water heater. So Distribution companies literally drop that pressure down. You can see here at the residential level It's cut down to four point. Excuse me four to six ounces per square inch. There are commercial Customers as well industrials and then of course electric utilities operation of the LDCs. They also perform a transportation Service in several states the industry is somewhat deregulated. That is there are end users Who do not have to buy natural gas from the gas company. They can actually buy it from third-party suppliers But the gas company for LDC performs a transportation function where they receive the gas from the transmission pipeline and Deliver it to these particular end users. So the end users have their own transportation on the LDC system It's what's known as open access that is other parties than the utility themselves can ship the gas there And as I mentioned previously these end users can buy their gas from third-party non utility suppliers Here's the breakdown of the total delivered cost of natural gas a lot of people often wonder You know when they see their gas bill how much of that the producer is getting how much is the utility getting? And you can see here that the single largest cost of delivered natural gas to the burner tip is the distribution company For their services commodity portion represents slightly more than a third of the total delivered cost and you do have the services of the Transmission and storage companies as well One point that I do like to emphasize is that gas companies are not allowed to make profit on the actual price of natural gas So for instance they buy gas at three dollars and fifty cents per MMB to you They can only charge you three dollars and fifty cents per MMB to you It's strictly what's known as a pass-through cost where they make their money is on the services Required to get the natural gas delivered to you and even those rates have to be Approved by their respective public utility commissions in each state There's often a mistake that people's one natural gas prices go up and their heating bills go up that it is a function of The gas company trying to make additional profit on them in times of high demand. That is not the case Typical gas meter that you might see outside of your house or outside of a building Talk about the various types of end users here is a skyline. This just happens to be the city of Denver And users very large group is electric generation the primary Subgroup there is the utility electrical generators or UEGs. They are regulated Producers of electricity then we have the non utility electric generators. These are independent power producers They have built power plant as an investment and are not regulated by public utility commissions Another subgroup or the co-generators. These are companies that actually generate electricity and steam and the steam is sold as an energy commodity in four, you know industrial processes and Within electrical generation, we have simple cycle generators. These are gas turbines again A turbine is nothing more than a jet engine has a similar type of fan blades And it's using natural gas as the fuel and it's in spinning the blades There is the shaft connected to magnets which spin within a magneto a copper housing that creates the current We also then have steam turbines steam is generated in a boiler and The steam is projected at fan blades Which are spun then and in turn drive the magneto, which creates the current More efficient types of generators that combine cycle. These are gas and steam turbines combined So you have a combination of the first two types You're going to have a gas turbine which is using a natural gas as a fuel, but the exhaust gas Coming off of that turbine is then run through a boiler And the heat from the exhaust gas then makes additional steam and then you drive a steam turbine So it's one of the most efficient uses of natural gas as a fuel is the combined cycle generation In co-generation you are running a gas turbine to produce electricity But you're also running a steam boiler where you're selling steam as an actual commodity This is a diagram that I showed you earlier. I like it not only because it's animated But because it's it's very simplistic and as I mentioned before the arrow on the left shows a fuel source coming in It does not matter what that fuel source is as long as that fuel fuel source can produce heat To produce steam the steam again driving the turbine, which is the blue and white spinning area the shaft tied to it You know to the right there is the copper housing the magneto Which has polar opposite magnets tied to that shaft and as they spin they create current The steam is then recirculated through a cooling tower Once it's cooled down it recirculates back through the boiler and the process starts all over again So this is a steam-driven electric turbine system There's a picture of electric turbine fan blades courtesy of General Electric. They're one of the world's largest producers of turbine electric generators I Show these pictures so that if you're out and about you'll recognize the types of power plants You've already seen the photograph to the left with the large cooling stacks represent a nuclear power plant, but on the right This is a coal plant this distinguishing features there are the very tall stacks as opposed to shorter stacks for natural gas Because of the emissions from a coal plant they put out a tremendous amount of hydrogen sulfide gas As well as the actual particulate matter it's almost you know, it's a dust and so it's got to be Elevated to where it does not stay in the particular area another distinguishing feature on the plant there You'll see a long conveyor belt moving from left to right. That's where the coal was brought up and put into the crushers So when you see these features, you'll know that is a coal plant as opposed to a natural gas fire plant Now the category of end users these are industrial end users petrochemical refiners In addition to using natural gas liquids, they actually run their plants on natural gas And so it's used as part of that process as well They can be used in paper production Your steel foundries and other metal foundries use natural gas in the actual furnaces there The stone cement industry Areas that have good amount of clay glass silicone can make cement and The natural gas is actually used to dry the cement which is a wet slurry type when it's processed And of course food processing probably one of the more obvious ones where natural gas is used to fire the massive commercial sized ovens Commercial industries believe it or not you can use natural gas as a source to run very large commercial sized air conditioners So that can be used in space heating and refrigeration Food service industry hotels motels health care office buildings retail services again Mostly this is being used for space heating or to generate hot water Natural gas vehicles have actually been around for a couple of decades There is a push to utilize them more and more they actually using compressed natural gas The most efficient types are dual-fueled so you can use gasoline or natural gas Depending on what's available to you. They are ideal for fleet vehicle usage Public schools will run their buses cities can run their buses companies such as FedEx UPS the US Postal Service can run their vehicles on natural gas any Company that has a fleet of pool cars because they are very very perfect for short-term commuting types of roots and the Part of problems with compressed natural gas vehicles as they exist today is the limited range They cannot go as far as as gasoline fueled vehicles and then of course the refueling stations Most of the types of entities I spoke about have their own refueling stations But there is not the infrastructure across the country yet to support interstate travel with compressed natural gas vehicles I know for instance that it's being studied the use of compressed natural gas in large diesel trucks But again the infrastructure will have to be there. They will have to have refueling stations at moderate intervals for that to become an efficient and practical way to ship goods