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Wednesday May 8, 2019   
I remember making the transition from being a high school math teacher to working my first days on a trading desk.  My head was spinning with the terminology that was being used on a daily basis.  This was back in the day where acronyms such as the PX or the ISO RT were being discussed as markets within California.  Not a day went by where the abbreviated version of the Mid Columbia (Midc) or the Desert Southwest (DSW) made their way into the conversation of spread trades tied to the SP-Midc or SP-PV markets.  The final straw was when the hydro guy whipped around the terms kcfs, MAF, HL, LL and ultimately STP.  I thought to myself, what kind of language are they speaking and when you saw it on paper, it looked like Alphabet Soup. Figure 1 | Alphabet Soup as we ... » read more
Tuesday May 7, 2019   
This past Friday, SoCal Gas posted another update to their maintenance and construction plan. The plan was to restore the ruptured 235-2 line that connects the Needles delivery point on the SoCal Border into their system prior to this summer providing some additional capacity for the peak cooling demand. Once that was restored, the company would focus their efforts on other pipeline inspections in the area. The goal is that all restriction to be lifted by this coming winter. Recent inspections of the 235-2 line have exposed additional corrosion problems which will take additional time to mitigate. This is the third time the line has been delayed with the return date being pushed back to June 21st. Each time return date is pushed back it calls into question the ability ... » read more
Monday May 6, 2019   
Over the years, the Renewable penetration has been quite impressive across California , Texas and parts of the Plains where SPP and MISO have a strong hold on the actual footprint.  Growth presents hiccups along the way in the form of transmission constraints to the influx of supply where curtailments are in order for the grid to balance.  The one market that has seen their curtailments pick up this year has been CAISO as its solar penetration is massive from both behind the meter and utility scaled facilities. Figure 1 | CAISO Utility-Scaled Solar Breakdown The graph above details the utility-scaled solar within CAISO by month/year.  The bottom pane represents the monthly average output with the bars while the line graph is the cumulative max generation from the inception ... » read more
Friday May 3, 2019   
If you have been following the West over the past few years, the one think you have to come to realize is expect the unexpected.  This is especially true when you consider Southern California has endured the Aliso Canyon storage facility leak, massive renewable penetration and natural gas pipeline constraints that led to SoCal Edison ridding their balancing area of any economic power burns last summer.  Up in the Pacific Northwest, the region got a taste of pushing power burns offline as the Enbridge pipeline (British Columbia) had an explosion that disrupted the flows From the T-South compressor down through Sumas and eventually drained Jackson Prairie and Clay Basin storage over the winter months. Since the end of the winter strip, the Pacific has done nothing but put gas ... » read more
Thursday May 2, 2019   
Portland is near perfect weather right now with highs hitting just 70 degrees while the sky is bright and sunny. However, the pessimist inside of me questions whether a good thing can last forever with summer just around the corner. The days will continue to get longer causing temperatures to continue to work their way upwards. Before you know it, summer will make its way onto the board bringing cooling demand along with it. Generation is well aware of this shift with facilities beginning to make their way back from outage. Looking at the Northeast, nuclear units have begun to return to the grid while current outages are also expected to come back over the course of May. The PJM outage schedule is finally showing a dip at the beginning of May with generation making its way back online. » read more
Wednesday May 1, 2019   
Over the past year, the volatility within California's natural gas market stems from the issues surrounding SoCal Gas's system.  It has been well documented when it comes to the issues at the Aliso Canyon storage facility as well as the transport capacity tied to the L3000/4000 maintenance work along with the L235 disruption on the Mojave compressor where a fire broke out back in October 2018.  Over the summer the Western market saw the gas world shift up at SoCal Citygate as Stage 4/5 Low OFO's were in play along with the penalties associated to each.  The penalties range anywhere from $5.00 to $25.00 depending on the severity.  This uplift causes the price of power to move substantially higher across the board as the marginal megawatt gets to compete with a gas-fired ... » read more
Tuesday Apr 30, 2019   
Just one month ago the Lower 48 storage complex was staring at a .2 TCF storage deficit. But thanks to blooming production, record renewables output and a drop in ResCom demand the fortunes have shifted. The inventory has now moved to a year on year surplus eliminating many of the concerns the market had for end of summer storage capacity. But that good fortune has not translated north of the border. Alberta is off to a slow start despite big gains in production. Looking ahead the refill pace is unlikely to improve. The NGTL system is currently undergoing maintenance and upgrades which will restrict storage access through much of the summer.  Figure 1 | Alberta Storage inventory for 2015 - 2019 Besides the system capacity issues, the power burns continue to soar. Right now the burns ... » read more
Monday Apr 29, 2019   
If you were in Nashville for any reason this past weekend, you were swarmed by football fans wearing their favorite team's jersey and cheering/jeering as the outside plaza area blasted each and every selection by teams during the National Football League (NFL) draft.  In recent years, the NFL has moved the venue on an annual basis to give cities, like Nashville, an opportunity to showoff their culture and make-up.  After the draft, the television crews are dis-assembling the stages and talk show booths that were used to cover the draft.  The players, who attended the draft (usually high draft picks), were swept away by a private jet so they could arrive in their newly coveted city where they were met with team personnel, fans and local reporters.  The lower drafted ... » read more
Friday Apr 26, 2019   
In December 2018, PacifiCorp released their 2019 Integrated Resource Plan (IRP), part of which covered an internal study of the economics of their coal fleet. The conclusions were that many of PacifiCorp’s operating coal plants are un-profitable. In a follow up meeting detailing an updated IRP on April 25, PacifiCorp concluded that an accelerated retirement of some of the Jim Bridger and Naughton coal plant units would produce the greatest gains to ratepayers. Here at EnergyGPS, we believe in leaving no stone unturned, and no hypothesis untested. To verify the conclusions of PacifiCorp, (specifically the Jim Bridger and Naughton coal plants) we need to explore what information is available in the public data sources. To analyze the profitability of PacifiCorp’s coal plants, we ... » read more
Thursday Apr 25, 2019   
ERCOT is an acronym that stands for Electric Reliability Council of Texas while ORDC stands for the Operating Reserve Demand Curve.  The nine letters have been joined at the hip as the former has implemented the latter into its real-time market when the grid becomes tight and it has to lean on its reserves to balance.  In one of our recent Newsletter Articles titled 'Changes in ERCOT's Scarcity Pricing', we detailed the impact of the new ORDC rule changes that went into affect this Q1. Over the past couple of days, the alphabet acronym pot started to percolate as the ERCOT real-time market was seeing their net load increase as wind died down and power demand increased.  When you tie that in with the fact that we are still in the outage maintenance season, the grid was ripe ... » read more
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