Featured Articles
| Friday Nov 6, 2015 | |
| With this week's EIA number posting a 52 BCF injection, the question I have is simple, should that be read as bullish or bearish. Figure 1 | EIA Weekly Storage Number The market took it as a bullish signal as it came in roughly 5-7 BCF below expectations and was below levels seen last year at this time. As a result, the front end of the curve shifted up $0.102 on the day, leaving the December contract at $2.364. Some of the people in the bullish camp are also pointing to the fact that this number is low when you take into account the mild weather that was ... » read more | |
| Thursday Nov 5, 2015 | |
| As we enter the first full weekend of November 2015, ERCOT saw a glimpse of the net load profile as wind within the ISO footprint averaged over 10,200 MW yesterday. With temperatures in the low 70's across the state, the existing load profile was already expected to be flat to Monday. Figure 1 | ERCOT Net Load - Hourly As you can see in the figure above, the massive increase in wind over the past few days has shifted the net load profile down to levels seen during the weekend of October 24th/25th, which is well below what hit the grid on Monday. When you look ... » read more | |
| Wednesday Nov 4, 2015 | |
| Over the past two months, Canadian storage facilities have traded operations, as the month of September saw MICA release water from behind the dam while October saw Arrow shift its elevation down while MICA was basically unchanged. Figure 1 | MICA and Arrow Storage Levels - Daily As you can see in the graphs in Figure 1, both MICA and Arrow are well below previous year levels. A lot of the action can be attributed to the Midc implied heat rate remaining in the natural gas stack and a stout evening ramp price signal in the CAISO DA auction over the last two ... » read more | |
| Tuesday Nov 3, 2015 | |
| In our past North American Daily and Weekly Natural Gas Reports, we have discussed extensively the coal to gas ratio calculation and the levels in which it has indicated that the natural gas fleet will knock out some coal units across the grid. As we mentioned, when November was the prompt month, the final days prior to expiry the ratio got as high as what we saw during the spring. Figure 1 | Coal to Gas Ratio The high point in October was when the November contract went off the board at $2.033 last week Wednesday. Since December was trading over the ... » read more | |
| Monday Nov 2, 2015 | |
| As the clocks got turned back on Saturday night (hopefully everyone had a safe and Happy Halloween), the daylight hours in theory get shifted up an hour making the morning routine a little brighter while the trip to the grocery store after work is feeling quite dark. Down in California, this translates into solar shifting up an hour as well as it is dependent on the sunlight of course. If you look at the solar profile on November 2nd compared to the 30th of October, you can see what I am talking about. Figure 1 | CAISO Solar Generation - Hourly As you can ... » read more | |
| Friday Oct 30, 2015 | |
| Over the course of a week, the sudden drop in the natural gas has impacted the market in several ways. The one thing that sticks out is how the coal to gas ratio has expanded to levels seen last spring when gas was thought to be at a low point coming out of winter and Production strong across the country. Figure 1 | Coal to Gas Ratio As a result, we saw power burns jump up quite a bit as entities starting to look at their portfolio as well as lean on the less expensive natural gas market to provide them with the power they needed to balance their ... » read more | |
| Thursday Oct 29, 2015 | |
| What do you get when the wind is expected to blow and some precipitation up in the Pacific Northwest? You get lower heat rates in both the Pacific Northwest and California, here is a breakout as to why. First, you get a longer grid in the region to where the marginal cost of energy has to move lower to incentivize natural gas units not to run. This occurred in the cash market for today with the Midc heavy load indexing at $19.44 and Malin coming in at $2.17. Up until this point, the Midc power price has been settling in the $23.50-$24.50 range with ... » read more | |
| Wednesday Oct 28, 2015 | |
| In the Pacific Northwest, people have been living off of borrowed time as the weather has been beautiful all Fall. Over the last few weeks, the overnight lows started to dip down to where the morning and evening ramp periods have shown an increase in demand. Figure 1 | BPA Load Profile - Hourly On the supply side, wind has been off and on since the middle of the month with Monday sitting in between 2,000 - 3,000 MW on any given hour. As you can see in the graph above, the wind quickly shifted down yesterday and should be somewhat low today. To keep ... » read more | |
| Tuesday Oct 27, 2015 | |
| The weather forecasts continue to show a warmer than normal start to November. For example, looking at the Res/Com BCF equivalent to the forecasted HDD/CDD's across the country, the first 9 days of November are adding up to 159 BCF whereas last year during the same time period was more in the ballpark of 245 total BCF (which is closer to normal). The 86 BCF delta divided by the 9 days in the period, makes the grid roughly 9.5 BCF longer per day. If this pattern holds true for another 10 day period, we could be looking at a 180 BCF delta year on year for ... » read more | |
| Monday Oct 26, 2015 | |
| As it rained here in the Pacific Northwest on Sunday, all eyes continue to be on the weather pattern forming across the country for the month of November. As we left for the weekend, a warmer start to November was being priced into the market as the prompt month ended the day on Friday just over $2.28. Such a close was $0.17 lower compared to where it started the week out and sliced right through a somewhat bullish EIA number on Thursday. As of Sunday morning, any white area to slightly blue (moderate to slightly cooler) across the Northeast corridor was ... » read more | |
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