Featured Articles
Monday Jul 8, 2024 | |
High power prices result in high heat rates and consequently more of the natural gas generator fleet can profitably turn on. In other words, more demand for power means more demand for gas. This was the case in California when the North (NP15 or PG&E service territory) hit near record high temperatures on June 3rd. Sure enough demand followed with a 0.355 BCF DoD increase in PG&E. Confusingly, the PG&E spot NG price had a DoD drop of $0.62. So, when demand increases and price deceases we must turn to supply. Figure 1 | California Regional Natural Gas Demand Summary (MMBcf/d) by Region From June 24th to July 3rd daily NG imports into California increased from 3.06 BCF to 4.37 BCF. This brought supply to comparable levels to those seen in June and July 2023, which were record ... » read more | |
Friday Jul 5, 2024 | |
June brought a significant increase in total system load to ERCOT—not only a large increase month-on-month (54 GW in May, compared to 62.1 GW in June), but also a significant increase year-over-year. At over 62 GW, this June beat out June of 2023 by 2.5 GW. Some of this came down to the structural load growth that has been in the conversation in ERCOT heading into the summer, but Texas also saw temperatures that were significantly hotter than normal for most of the month. All of the hot and sunny weather was great for solar generation, which continued to provide peak output close to 20 GW on the sunniest days. However, the figure below shows that wind also performed extremely well, especially for the time of year, when the more typical trend is for wind to die down with the ... » read more | |
Wednesday Jul 3, 2024 | |
Monday was the first day of July and with a new month comes new publications of our monthly dashboards. These dashboards are updated every month on the 1st with updated data that allows for insights into trends on monthly, quarterly and yearly levels. Take a sneak peek at three of our monthly dashes below. If they peak your interest, we offer individual monthly/annual subscription access via the EnergyGPS eCommerce Platinum Package. If you would like multiple licenses or incorporate the content into a broader North Amercia Power and Natural Gas product, email us at sales@energygps.com for more information. CAISO Monthly Battery Dashboard (sample) As we mentioned a few weeks ago in this blog, the CAISO Monthly Battery dashboard has been recently updated. One of the first ... » read more | |
Tuesday Jul 2, 2024 | |
We have talked about the robust wind generation we saw in SPP this past June, but the Lone star state was also lucky this past June, as Mother Nature gifted ERCOT an impressive amount of wind volumes. The graph below shows a year-on-year comparison of net load and its components (load and renewables) for the past three years, with 2024 in yellow, 2023 in red and 2022 in blue. Figure 1 | ERCOT Monthly Profiles, 12x24 YoY The wind output for this past June is not far from the level seen in June 2022 but the 2024’s shape was somewhat higher across the evening block of hours. Also, if we zoom in on the bottom pane, net load was lower this June 2024 mostly because of the increase in solar generation, but also it was slightly lower during the evening hours when wind megawatts were ... » read more | |
Monday Jul 1, 2024 | |
Part of what keeps our job interesting is the interconnectedness of different markets. It’s never enough to only track the story of an individual power markets. To really grasp what’s driving those prices on any given day you also need to have a handle on the larger interconnect (unless we're talking about ERCOT of course), the overlapping natural gas markets, weather forecasts, renewable forecasts… the list goes on. And for each one there will always be new nitty gritty details to uncover. It can be a lot, but the good news for you is that we track them all. A perfect example of this comes from today’s movement in CAISO’s demand and price. The line in green shows day ahead load on June 25th while blue depicts the same values for July 1st. If you thought of ... » read more | |
Friday Jun 28, 2024 | |
We have been developing a fundamental-based long-term forecast model for the last few years. As part of the forecast, we use a Production Cost Model (PCM) to forecast a future capacity mix across the WECC. The PCM solves for the future capacity mix by finding a least cost solution to meet future load growth given a set of generator candidates subject to policy and operational constraints (e.g., Renewable Portfolio Standards, Clean Energy Standards, emission targets, transmission constraints, build constraints, etc.). One of things we have found through the course of developing our long-term forecasts is that the amount of capacity required to meet current policy goals greatly exceeds the amount of capacity that has been historically added to the WECC. For example ... » read more | |
Thursday Jun 27, 2024 | |
The transition from the shoulder months into the summer season was a time of relief for everyone in CAISO showing up at SP15 with generation to sell during the heart of the midday. Over the first five months of 2024 the market was inundated with excess supply in Southern California as the new solar capacity additions since the summer of 2023 came online and showed up in force, complicated by a strong hydro year leaving the reservoirs close to full and large surpluses of gas in storage throughout the West, driving gas prices down and incentivizing plenty of thermal generation. The result was plenty of solar MW without an easy home and limited transmission to move it out of the region, leading to massive congestion at the SP15 hub and large negative midday prices. ... » read more | |
Wednesday Jun 26, 2024 | |
This spring the trend for SP15 batteries was low prices and high arbitrage opportunities. The low midday prices for SP15 began with work on the intertie, stranding the abundant solar energy in SoCal, and continued even after the maintenance wrapped up. By March, SP15 buy prices were well below $0/MWh at -$30/MWh and then dropped further still to average at -$36/MWh in April. Even NP15 batteries got to join in on the fun as NP15 buy prices for batteries in April dropped to single digits and even below $0/MWh last month. June, however, has seen a reversal of that trend, especially in the last few days as both NP15 and SP15 prices have risen while congestion is greatly reduced. Figure 1 | Price Responsiveness – Battery Operations and RTM Price The figure above is featured in our CAISO ... » read more | |
Tuesday Jun 25, 2024 | |
Mother nature has gifted a healthy amount of wind volumes to the SPP grid this month as depicted in the figure below. The current year is marked in red, 2023 in orange and 2022 in green. This graph shows net load and its components for the past three years on 12 months by 24 hours basis. We can see that the wind generation has been significantly higher this month compared to the previous two years. Load has been in the range seen in the past two years and as a result, net load shifted lower this June 2024. Figure 1 SPP 12x24 Profile – Last 3 years Mother nature did not just offer the wind in SPP, the heat has also been present in the region just like in the rest of the country. Warmer temperatures started to kick in since the middle of this month. The table below shows the ... » read more | |
Monday Jun 24, 2024 | |
It seems that everywhere you turn in the electricity industry as of late you encounter talk of load growth. AI might still be something of a buzzword, but data centers are very real with substantial MW demand. Likewise, warmer temperatures mean more demand for cooling, and all long-term forecasts show most of the US facing above average temps this summer. Load growth is real, the EIA estimates 1% annual growth in US demand through 2050, but don’t believe the hype. If you want to see how load growth is playing out in the short term at a local scale you need to dive into the data. As much as data centers and electrification are real phenomena, so are insulation and behind-the-meter solar. Where narratives get messy, numbers provide clarity. Figure 1 | ERCOT Load vs. Temperature, Jan. » read more |