Natural gas for January delivery in the Northeast is the most expensive it has been in more than a decade due to concern that pipelines may not be able to ship enough fuel, according to a recent article by Bloomberg

Supplies in the Northeast and Midwest are at the lowest seasonal level since 2000, according to government data, and the new pipelines being planned for New England won’t begin service until late 2016 at the earliest. Natural gas for January in New York is now selling for $13.60 per million British thermal units, more than nine times current prices. Last January, gas surged to a record $135 as frigid weather boosted demand beyond what pipelines could deliver.

“People are scared,” Kyle Cooper, director of research with IAF Advisors and Cypress Energy Capital Management, told Bloomberg. “The market is reflecting that despite prolific production growth in certain areas, the infrastructure has not been expanded to distribute that gas all the way across the country. There’s still a very real and very significant constraint.”

Gas for delivery to the Algonquin City Gates in New England next January was valued at $20.943 per million British thermal units on Oct. 3, a $16.86 premium to Henry Hub, according to Bloomberg Fair Value prices. A year earlier it was trading at a $8.498 premium, which means that prices look to be much higher this winter.

“We have seen basis very strong the last few weeks,” Kate Trischitta, Director of trading at Consolidated Edison Inc.’s wholesale energy trading unit, told Bloomberg. (Basis is part of the final cost for delivered fuel.) “After what they experienced last winter, no one wants to be caught short. The reality of very cold periods or very high demand periods is you are going to have very big basis swings.”

ISO New England Inc., which saw the highest average gas prices in the country last year, has expanded a reliability program that provides power generators with payments to cover costs for stockpiling backup fuels such as oil and liquefied natural gas to replace natural gas when it is unavailable or overpriced, Bloomberg reports.

New England’s reliance on gas-fired generation will increase this winter after two plants are taken off the grid. Entergy Corp. will permanently shut its Vermont Yankee nuclear reactor in the fourth quarter. Footprint Power closed its 720-megawatt Salem Harbor plant, fueled by oil and coal, in May to convert it to burn gas.

To read the Bloomberg article, click here.