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| Tuesday Jul 28, 2020 | |
| In April of this year we had on one of the most defining moments in the history of the crude industry. Driven by an abundance of supply and limited storage the futures price crashed down to minus $37 for the May 2020 WTI settle causing a seismic shift in energy operations across the world. Global oil output fell by 7 million barrels per day with one third of that total in the United States. We are just now starting to get the financial impacts of the shock. Oil companies are posting Q2 earnings with detail of the operations changes from Q1. One of the constant themes from the earnings releases is that there may be no getting back to where we were at the beginning of the year. The CEO of Parsley Energy Matt Gallagher stated that oil production in the Permian has peaked ... » read more | |
| Monday Jul 27, 2020 | |
| It is a whacky world we live in as the coronavirus has plagued the world over the past four months and no real end in sight for many states as the number of cases continue to grow. When it comes to the injustice of inequality Portland has become the hotspot when it comes to the protests downtown around the Federal Buildings. It was not too long ago that the President sent armed forces to Portland as it was deemed protection was needed at the highest level. This past week saw the mayor of Portland stand amongst the protesters only to be tear-gassed by the armed forces and mocked by the President in one of his communication platforms to the public. Figure 1 | Portland Protests Outside of downtown, the City of Portland is similar to any other city battling the policies and ... » read more | |
| Friday Jul 24, 2020 | |
| In early 2019, Washington State legislature passed and Governor Inslee signed the Clean Energy Transformation Act (CETA, or SB 5116). CETA includes three major mandates on Washington State’s Investor- and Publicly-Owned Utilities (IOUs and POUs). First, CETA mandates that all coal-fired resources must be eliminated from the portfolio of generation resources used to serve Washington consumers by December 31, 2025. Second, all electricity sold at retail in Washington must be greenhouse gas (GHG) “neutral” by January 1, 2030. As part of the this GHG neutrality requirement, 80% of electricity delivered to Washington customers must be from non-emitting or renewable resources. The remaining 20% may come from unbundled RECs, investments in energy transformation ... » read more | |
| Thursday Jul 23, 2020 | |
| Historically, by this time of year the Major League baseball season would be well past its halfway mark, we’d be entering the dog days of summer, and conversations about pennant runs would start to take place. But nothing is normal, anymore. Take SoCal weather for example. Over the next four days, temperatures throughout the major load center of the Los Angeles basin are forecast to run 5-7˚F below normal. In a typical March or April, if one would experience temperatures akin to those being forecast for this week, you’d walk outside and declare, “Now this is baseball weather.” But not when these temps show up in July. The California cooldown will squash power loads and suppress renewables generation, but this – along with a ... » read more | |
| Wednesday Jul 22, 2020 | |
| Growing up in the rural part of the Midwest, my summer job was to work with my father as a plumber's assistant, translation a labor job where each and every day was to dig trenches, work under old homes to fix a leaky pipe and work the contraption that unclogged tree roots blocking the sewer passage. On many occassions, my father's journeyman's employee would say be cared of being caught downstream of the blockage. Oh so how true that was!!! Since most work was on farms, I also got acquanted with the saying 'bring on the rain' as the farmers talked to the weather gods on many occasions as their crops depended on the moisture in the soil. On the days when a good ole thunderstorm rolled through, you could feel the humidity get released and the temperatures shift ... » read more | |
| Tuesday Jul 21, 2020 | |
| Alberta's energy dependent economy is on the long road to recovery. They were hit brutally hard by both the pandemic as well as the lifting of Saudi oil limits back in April. StatsCan estimates the provincial economy crashed somewhere between 30 and 68% during the height of the lock down depending on methodology. Most of this was due to the shuttering of oil sands processing. As a result the royalty income from the sector has gone to near zero. The provincial government was already experiencing budget issues prior to this spring. Announced at the beginning of the month they now expect the shortfall to grow from 7 to 20 biillion C dollars for this year. Desperate times call for desperate measures. Premier Kenney has put forth a plan to boost infrastructure spending by ... » read more | |
| Monday Jul 20, 2020 | |
| Over the past few months, the world has taken on a virus like no other in the modern era as countries have shut down, economic hardship is real and individuals are trying to figure out how life will be on a going forward basis. The United States has been a part of this movement where it seems that we are moving to the forefront of the conversation with the rising number of cases in many states that have re-opened. Figure 1 | Daily Coronavirus Case Report in United States - CDC There was talk back at the beginning of May that the spread of the virus would slow with the summer weather being warmer and such. It seemed to be a little premature but it was the kind of infomation the people at the top wanted to hear as re-opening states translated to the ... » read more | |
| Friday Jul 17, 2020 | |
| ...is Wonderful! So said Liberace, the not-critically-acclaimed but nonetheless highly influential proto-glam-pop American artist. And if only his consumption preferences prevailed in our chaotic-but-ultimately-rational world of power markets where value is measured with normal concave functions. In such a world, more of a good thing is, well, worth less. Indeed, the non-Liberace-ian view of marginal value is bearing out in a newly published assessment of long-term capacity values of renewable resources. On July 1, California’s Investor Owned Utilities (IOUs) published new estimates of effective capacity values for renewables (SCE AL 4243-E / SDG&E AL 3560-E / PG&E AL 5868-E). As is now becoming standard industry practice, the capacity ... » read more | |
| Thursday Jul 16, 2020 | |
| Nicht mehr (German), Niet meer (Dutch), Pas plus (French), No mas (Spanish), No more (English) European storage is swollen and can hardly take more gas, keeping the bearish outlook for U.S. LNG exports in place. Though major cities across the continent have had a few heat waves to lift gas demand this summer, the events have been short-lived and barely slowed the rate of storage injections. Otherwise, weather this summer has been at- to slightly-cooler-than-normal, keeping gas demand in check. As a result, EU storage inventories are currently sitting at levels typically not seen until late-Q3/mid-Q4. Daily gas storage injections, withdraws, and inventory levels are reported for 20 countries, including the Ukraine and United Kingdom. The region can store ... » read more | |
| Wednesday Jul 15, 2020 | |
| The day is finally upon us, it is no other than Tax Day!!! The joyuous or dreaded day usually sits in the middle of April (15th) but with all that has happened starting in February/March, the government pushed the day back three months hence July 15th is noteworthy. For most, both federal and state taxes are in the cards and if you are owed money the hope is that you filed early while the ones that owe go up to the brink of midnight or ask for an extension. Extending something that has already been extended seems like a stretch but anything is possible these days. Depending on where you live, you have to also pay some country or city taxes that get passed on during an election year. Such ballot initiatives are buried sometimes while others are front and center. In ... » read more | |