Featured Articles
| Friday Jul 12, 2019 | |
| We’re well into summer and we know that many of our subscribers are starting to dream of the impending summer vacation. The warmth. The relaxed clothes. The feel of sand. The taste of a pool-side cocktail. And, that perfect book. But, wait, what book should you bring along? We at Energy GPS know you’re dedicated to your craft and are likely to be more relaxed and happier reading a well-written book relevant to the world of energy, trading and data analysis than one written by, say, Nora Roberts. Books about the business of energy, economics and statistics need not be dull. The following is an intentionally non-comprehensive, subjective list of books we recommend, known as the EnergyGPS Summer Energy Reads. And what about you folks who haven’t picked ... » read more | |
| Thursday Jul 11, 2019 | |
| New England had a hard time finding gas molecules over the last several years. The lack of fuel was largely due to continuous expansions along the Algonquin Pipeline that were associated with a high amount of planned outages. However, this year the planned outages look significantly different. While there is still the Atlantic Bridge pipeline expansion that is a work in progress, capacity restrictions appear to be less severe. The increased fuel availability has also migrated into the electricity market with lower prices keeping LMPs from seeing much upside. The compressor capacity along Algonquin reflect the shift in outages. While there are a handful of interconnections that supply can flow through further north, Stony Point represents a major artery for gas flowing into the region. » read more | |
| Wednesday Jul 10, 2019 | |
| The Aliso Canyon storage cavern in Southern California happens to be one of the largest and oldest facilities in the United States. When the cavern ruptured almost four years ago it set off a chain of events that has thrown the supply demand balancing in California into chaos. The California Legislature enacted a mandate ending the caverns use in normal day to day balancing of the SoCal Gas system. Even after the site was deemed safe and reliable by the state's own engineers at the Department of Gas and Geothermal Resources (DOGGR), its use was still restricted as an asset of last resort. As a result, SoCal Gas has had a difficult time managing system pressures. Any high demand event had the risk of causing a loss of service for the Los Angeles Basin. And because of the ... » read more | |
| Tuesday Jul 9, 2019 | |
| Coming out of the long weekend, ERCOT is playing out as expected given the warmer weather in the forecast and the higher power demand across the state of Texas. If you look at the net load (power demand minus Renewables (wind)), the grid is getting shorter by roughly 1 GWa day on day but over 7 GWa when compared to where things were last week prior to the 4th of July weekend. It all starts with the weather as temperatures have risen and the storms in the southern portion of the grid have subsided. Figure 1 | South Central Weather Forecast Matrix Taking a look at the matrix above, the horizontal dates represent the time of the forecast while the vertical axis is tied to the actual flow date for the daily forecast. As you can see, the next 48 hours has been bright red for ... » read more | |
| Monday Jul 8, 2019 | |
| Hopefully everyone enjoyed the long holiday weekend that included some fireworks on the 4th of July. In the energy markets, the fireworks included a 6.4 magnitude earthquake that shook Southern California during the morning of the 4th and aftershocks that were felt in Las Vegas a couple of days afterwards. From a grid reliability standpoint, things look to be fine as there were no notices sent out by SoCal Gas tied to the quakes. From a power standpoint, the hourly demand profile was moderate as temperatures were tempered all weekend with daytime highs in the low 80's across the region. Figure 1 | CAISO Day-Ahead Hourly Load Profile As we work our way through the West, the Pacific Northwest saw few fireworks from the power grid as wind output was strong from ... » read more | |
| Wednesday Jul 3, 2019 | |
| Coming out of the winter, Socal Gas had a couple of hurdles that needed to be addressed prior to summer. Depending on the outcome of each would impact how the market would look at the physical flow of power and what price to attach to the daily market settle. If you recall, last year saw some massive volatility as SoCal Gas added over 10 BCF of gas storage over the summer months of July and August. This brought a bid to the market as the incremental buying was during a time when the transport capacity from the Desert Southwest was limited due to constraints tied to the L235 work being performed. Mother Nature also had a say in things as the month of July was one of the warmest on record in Southern California. In fact, it was about this time last year where ... » read more | |
| Tuesday Jul 2, 2019 | |
| The Midwest is seeing its first heat event of the year this week. Temperatures have soared into the low 90's and with the saturated ground from the record breaking rains the heat indexes are near 100. As a result the net loads for both MISO and PJM have soared. The biggest change happens to occur on the off peak hours. With the overnight lows moving into the mid 60's, we are starting to see around the clock increases in cooling load. This is forcing both control areas to add more resources to the grid to meet the demand. Figure 1 | Chicago Hi/Low Temperatures for May-July Thanks to this spring's drop in natural gas pries we have already seen the generation stack push as much coal output out of the dispatch. If you look at Figure 2 below, MISO and PJM gas generation is already ... » read more | |
| Monday Jul 1, 2019 | |
| This week's EnergyGPS Newsletter article, titled 'The Storage Story - Chapter 2', highlights how the power market is evolving now that several of the Independent System Operators (ISO's) are spending the majority of their day discussing how the supply stack is changing with the likes of wind and solar penetration what it is and where it will be going in the next couple of years. Many regions are able to piggy-back off of the lower natural gas production basins and build flexible gas-fired units that are useful for the intra-day volatility around the net load. Figure 1 | California Net Load Profile - Hourly As you can see in the figure above, the state of California has to deal with the massive amount of solar penetration on a daily basis as the entities involved continue to strive ... » read more | |
| Friday Jun 28, 2019 | |
| It’s the Friday before the 4th of July which means one thing dear blog readers – you will find nothing about the energy markets in today’s issue. Your author of today’s blog is Tim Belden, one of the Principals at EnergyGPS. As has become custom for several years, I will provide you with a recap of my Aluminum Man competition held in Sisters, Oregon last Saturday. Long time readers are familiar with the competition. In fact, a small number of readers claim this annual update is the only reason they subscribe to this blog. The event is called “Aluminum Man” (think aluminum foil) because it is the opposite of an intense event such as Iron Man. The event consists of twelve men competing in a series of ten individual and team events where teams are created ... » read more | |
| Thursday Jun 27, 2019 | |
| While the heavy rain shifted temperatures lower at the end of last week, the weather has begun to heat up as we head into Q3-2019. Looking at Figure 1, we can see that an orange blob has begun to cover the region. In practical terms, averages have climbed into the 80's throughout the southern portion of PJM while more northern regions are still reaching up to the high 70's. Although the weather has not reached near record highs, the warm temperatures will see start to slight the marginal MW higher in the supply stack and start to show market participants how hedged entities with power load are this smmmer. Figure 1 | WSI Northeast Average Temperature Forecast Taking a look at PJM, the market posted a notice on Wednesday alerting participants of upcoming high demand and listed hot ... » read more | |
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