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Wednesday May 9, 2018   
Over the years, the Pacific Northwest entities in the power sector have figured out how to best keep the wind in the region from being curtailed.  Some of this is tied to moving power from the Pacific Northwest up into Canada while two other elements have direct ties to turning off thermal generation or reducing the output from the lone nuclear facility known as Columbia Generating station.  The final piece of the puzzle goes into the hydro system and how system operators handle the spill at each facility.  This becomes tricky as fish spill season is in play and the Total Dissolved Gas (TDG) levels are being monitored closely.   Figure 1 | Total Dissolved Gas (TDG) Levels - Daily The table in Figure 1 illustrates the daily TDG levels at key dams along the Lower ... » read more
Tuesday May 8, 2018   
As we start to work out way through the work week, it is sometimes nice to see what is going on in the real-time market as wind generation can wreak havoc depending on if it is coming in above/below the expected forecast.  In previous newsletters, we have discussed the increased wind capacity throughout the Lower 48, specifically SPP and ERCOT.  In a newsletter article, we detailed how curtailments played out at the end of April and early part of May as well. Figure 1 | Year Wind Cumulative Max Generation - SPP and ERCOT The top pane is SPP's cumulative yearly max generation output on the grid while the bottom pane represents ERCOT.  If you look at SPP, the last two years are identical as there was a big uptick in December 2017 as a new transmission line was in play that ... » read more
Monday May 7, 2018   
Temperatures out west are warming up this week.  While you can't see it in Figure 1, last week was quite mild in the region, with normal temperatures spanning from the Pacific Northwest (PNW) down through California, and over to the Desert Southwest (DSW) and up to the Rockies.  Moving forward the entire region for the better part of the next two weeks, barring a couple day cool down in the PNW, is going to be above to much above normal.  The two interesting items to note with such a ridging pattern is with regards to wind generating and load.  For the most part, when ridges like this set up, the wind output is generally quite low.  For most parts of the WECC, wind output and warmth do not generally go together.  Towards the middle of this week the PNW ... » read more
Friday May 4, 2018   
Over the years, the Pacific Northwest hydro circumstances leave Bonneville's system operators no choice but to move the regulation up reserves off the Lower Columbia River and up to Chief Jo Dam.  The reasons for this are plentiful, with the main reason tied to the Total Dissolved Gas (TDG) levels are running near the top of the range.  If the operators  spill any more at any of the facilities, it would jeopardize the fish in the river.  Figure 1 | Total Dissolved Gas Levels - Past Three Days Figure 1 shows the last three days of Total Dissolved Gas levels at key dams on the river system.  The dams with red coloration are facilities that are over the upper limit bounds of gas on the river.  The black coloration are within 3% of the yellow colored ... » read more
Thursday May 3, 2018   
Downtown Minneapolis is filled with enclosed walkways connecting the many skyscrapers while the University of Minnesota East Campus has an underground tunnel system connecting the old historical buildings throughout Northrop Mall. Figure 1 | Downtown Minneapolis Skywalk   The reason is simple, it is to protect the individuals living/visiting the vibrant city or university from the elements Mother Nature brings to the region such blistering cold weather or massive gusts of wind that rip through the streets or around the buildings.  A little further south and east, there is a city that sits on Lake Michigan that is know as the 'Windy City', yes it is Chicago.  If you have ever walked along Lake Shore Drive on a winter/spring day, the gust of wind off the lake can be so ... » read more
Wednesday May 2, 2018   
After an absolutely brutal April we are starting to see some serious warmth on the horizon as we enter May.  While the current forecast is trending well above normal, May is typically the month which sees the largest shift between heating degree days (HDDs) and cooling degree days (CDDs).  Below in Figure 1 we have charted normal HDDs and CDDs (weighted) for the US as May progresses from start to finish.  Here we can see a gradual transition, as CDDs overtake HDDs just after mid-month.  Figure 1 | ConUS Daily Normal HDD vs CDDs - May As mentioned above, this season is not expected to have a smooth transition, with the majority of the country going from well below to well above normal temperatures in less than a week's time, per Figure 2.  The low pressure ... » read more
Tuesday May 1, 2018   
The 1973 title fight covered by Howard Cosell is more known for the color commentary than it is for the quality of the boxing. An undefeated champion Joe Frazier took on a younger, stronger, and undefeated George Foreman in what was billed for months as the fight of the century. In the end, it was not much of a contest. Big George had his way with Smokin Joe and the fight was called within two rounds. You wouldn't know it by the way the fight has been portrayed in history. It is often on the short list for greatest sporting moments despite the quick work that the challenger made of the champion.  The natural gas basis markets have been anticipating the the battle for May AECO for more than six months. Back in the fall, Nova Gas Transmission posted a preliminary outage schedule for ... » read more
Monday Apr 30, 2018   
It seems like every time one turns on the news or opens the newspaper in the Pacific Northwest they read something about somebody having issues with the Bonneville Power Administration (BPA).  Environmentalists attack BPA because the dams they operate have been known to kill salmon and steelhead, fish for which most people in the region would like to see increased survival rates.  As a result, every spring BPA is forced to spill water through the spillways (as opposed to generating) at eight dams on the Lower Snake and Lower Columbia rivers in an attempt to improve the probabilities of salmon and steelhead surviving their trip to the Pacific Ocean.  This costs BPA, and thus their customers, $10's of millions of dollars per year.  Starting this year, as we have ... » read more
Friday Apr 27, 2018   
A couple of weeks ago I wrote a newsletter titled "Shapely Prices." In that missive I took a look at the value of solar and wind production-weighted prices compared to simple block prices. The punchline of that newsletter appears below in Figure 1.  The x-axis represents load share which is the total percentage of annual load that is met by that resource. For example, in 2017 ERCOT wind had 17% load share (the right hand orange plus sign) while CAISO solar had 11% load share (which is likely more like 15% due to roof top solar which is not in this data. The y-axis is what we call a "scalar" which is calculated by taking the resource-weighted value compared to a simple 8760 price. The solar scalar in the CAISO in 2017 was about 79% while the wind scalar in ERCOT was around 85%. We ... » read more
Thursday Apr 26, 2018   
The Algonquin Pipeline (AGT) has been a focal point which ISONE prices hinge. This electrical grid is a unique system that reaches its highest prices in the winter caused by residential and commercial heating demand. AGT is pushed to its limits, which turns natural gas into a scarce resource for power generators as the pipeline reaches binding constraints at the Stony Point Compressor. With gas choked off, the grid resorts to oil which becomes the cheapest fuel available but multiple times more expensive than natural gas when there are no constraints. The shift in generation ultimately leads Mass Hub LMPs rocketing upwards, like we saw in January of this year. On the other hand, summer has even greater electrical demand, but in the past has not seen the same fuel switching dynamic. With ... » read more
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