Featured Articles
| Wednesday Sep 25, 2019 | |
| In the coming days we will see a big shift in the North American climate. A ridge is developing right through the continent that will set up a cool west/warm east dynamic. For most of the country this will continue the above normal cooling load. But for Western Canada, this will be their first taste of winter. Average temperatures in Calgary will drop from 50 to 31 degrees which will take the Nova Intra load up from 4.8 to 5.5 BCF per day. This is going to occur when the distribution system is still undergoing summer maintenance. For most of the past seven months they have been plagued with a number of forced and planned outages that have restricted access providing a very tight balancing dynamic. As a result the Alberta gas storage inventory is posting 81 BCF behind last years refill ... » read more | |
| Tuesday Sep 24, 2019 | |
| if you have ever been to the doctor with someone who is afraid of getting poked in the arm with a needle for either an IV or to draw blood, you know what I mean when I say needles hurt and can make people act in a way that is different than their normal self. The energy market in ERCOT and Califronia work the same way when it comes to market dynamics playing out where the middle of the afternoon/evening ramp show a large spike in the outright power prices therefore expanding the implied heat rates. Such periods start to create a shape similar to a needle poking out of the hourly pricing profile that warrants the attention of many. Most of this type of price action is driven by the load forecast demand coming in higher than expectations thus making the grid shorter while ... » read more | |
| Monday Sep 23, 2019 | |
| As we work out way through the last week of September and roll into October, the power grids continue to be dynamic as the power demand has spurts of warmer weather still while the supply stack is ramping up its outage season where nuclear, coal and natural gas plants are offline for their annual maintenance. The other element that starts to disrupt the power supply stack is the transmission capacity reduction tied to work on a specific line. Each and every one of these components starts to move the supply stack's volume in a way that impacts the marginal cost of energy. In the Pacific Northwest, the supply stack is getting longer as the AC transmission line just reduced its capacity for some planned maintenance. The reduction will last all week and next therefore ... » read more | |
| Friday Sep 20, 2019 | |
| I have to admit, it’s a lot of fun when an argument breaks out between electricity market design geeks. By “geek”, I mean people who are knowledgeable, take electricity market design seriously, and have the chops to think about these things. Last month, an outfit called Grid Strategies put out a paper titled “Consumer Impacts of FERC Interference with State Policies – An Analysis of the PJM Region”. If that’s not a New York Times best selling title I don’t know what is! This week, an outfit called Monitoring Analytics, which just so happens to be the PJM Independent Market Monitor (IMM), published a memo with an opening line that states “Grid Strategies published a report … that relies on an analysis by the Independent Market ... » read more | |
| Thursday Sep 19, 2019 | |
| Renewables have been a long time coming throughout the PJM footprint. While wind generation made an appearance throughout the West, total renewables still only represent a sliver of total capacity in the ISO. The tide appears to be turning over the next four years with the interconnection queue showing a large ramp in renewable capacity. Contrary to the previous wind buildout, the new renewable capacity appears to be largely composed of solar generation. Figure 1 | Sunny Weather Renewable capacity additions appear to rocket up with over 40 GWs of generation in the queue. Solar generation composes the majority of new renewables with over 35 GWs throughout the same time period. Wind generation, by comparison, is just a fraction of this with less than 5 GWs in the queue. Storage is also ... » read more | |
| Wednesday Sep 18, 2019 | |
| If we were in the months of October/November, the corner street drains would be filled with massive amounts of water as the leaves from the trees would not have been swept away yet. If this was December, the conversation woud be around the Bonneville tailwater levels being quite high as the fish eggs are being laid and details around the impact of the river system as we move further into the water year. The reality of the situation is we are now in the middle of September and it has been one of the wettest on record with 14 days to go and a forecast calling for more rain. Figure 1 | The streets of Portland and the rain I thought it would be good to give everyone not living in the beautiful Pacific Northwest a glimpse of what has transpired. First, it has been a record ... » read more | |
| Tuesday Sep 17, 2019 | |
| The weekend's attack on the Saudi oil infrastructure helped lift the NYMEX crude contract to $62.90. The 11% move in the NYMEX CL contract was enough to garner some sympathy from the natural gas market. NYMEX HH ended up the day 6 cents higher settling at $2.68. But this run on natural gas started almost a month ago. Since the last week of August the prompt continuous has risen from $2.13. This rally has been all from strength in the near term. There are two main factors that are supporting the strength. Figure 1 | Q1 and Prompt NYMEX Futures and Henry Hub Cash As we near the end of the storage injection period, the South Central Salt facilities are now rushing to fill the caverns. From the middle of March to the end of June, the salt storage caverns injected 130 BCF taking ... » read more | |
| Monday Sep 16, 2019 | |
| Friday the 13th is always a special occassion as the superstitions are plentiful and who's to say that if you are into the tradition, sitting down and watching all the Friday the 13th movies is not out of the question. This past Friday was unique as there was also a full moon present. The last time something like this happened, it was in the fall of 2000. Scientists have stated over the years that such an occurance happens on average every 20 years or so. The forecast is for the next to take a little longer (30 years) as many in the research community have it pegged for 2049. That seems a long way off but the rarity of such a day got me to think about how far we have come since the last Friday the 13th Full Moom and where the energy markets might be when the ... » read more | |
| Friday Sep 13, 2019 | |
| Earlier this week I spent a few days at the annual NIPPC conference at the Alderbrook Lodge located on the beautiful Hood Canal near Washington’s Olympic Mountains. NIPPC stands for “Northwest and Intermountain Power Producers Coalition – a trade association whose membership is primarily comprised of a handful of merchant natural gas generators, wind owners, and renewable project developers. Before diving into some of the conference highlights, I want to mention NIPPC’s long-time executive director, Bob Kahn, who passed away in August after a brief and intense battle with non Hodgkins lymphoma. Bob’s vision and leadership have contributed immensely to the policy debates in Northwest energy circles. He was a strong voice for competitive markets and understood ... » read more | |
| Thursday Sep 12, 2019 | |
| New England has been dependent on gas generation to supply a majority of its electrical needs for a long time. The region relies on the Algonquin Pipeline to supply cheap natural gas to facilities in the region, but this lifeline has continued to be subject to capacity constraints with prices skyrocketing when it binds. However, the grid has decided it is time for a change. The latest state of the grid presentation reported that the ISO will continue to try and shift away from natural gas generation towards renewables with an emphasis on distributed supply. Figure 1, taken from the state of the grid presentation, shows how the market expects this to play out. Figure 1 | Shifting Resources from State of the Grid ISONE While Figure 1 displays two changes happening simultaneously, both of ... » read more | |
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