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Friday Dec 23, 2022   
With Elon Musk tweeting on December 20th “I will resign as CEO [of Twitter] as soon as I find someone foolish enough to take the job”, one can only assume that this means he intends to devote more energy towards carrying out his goal of sending 1 million colonists to Mars by 2050. Given that Mars is inhospitable without constant life support systems, reliable power generation would be the lifeblood of any Martian settlement.   In film, Martian base power sources have ranged from the heat of decaying plutonium-238 (The Martian) to mysterious 500,000-year old alien reactors (Total Recall). As seasoned energy analysts, we know that many of the ideas portrayed in film, quite frankly, are unrealistic[1] and ridiculous. As such, we offer up our preliminary analysis of the ... » read more
Thursday Dec 22, 2022   
With the frigid winter cold still lingering over much of the West for a few more days, the bulk of the weather event is moving East across the country with the Midwest and South-Central regions now sitting squarely in the crosshairs.  In fact, the temperatures are such that the HDD accumulation for one day outpaces that of any day seen during the infamous February 2021 Storm Uri event that nearly put an end to the ERCOT power grid and exposed the natural gas pipeline infrastructure as both megawatts and molecules were sought after for a period of 10 days. The upcoming weather event looks to be a short burst from now through the holiday weekend, and each market has been discussing the preventive measures that need to be taken to make sure the power grid and pipeline infrastructure are ... » read more
Wednesday Dec 21, 2022   
Alberta is facing frigid temperatures this week with lows in Calgary down to -28 degrees overnight. The frigid temperatures are more than 15 degrees cooler than normal for the start of winter in the region. It’s a continuation of below normal temperatures that have lasted throughout this autumn and now into the holiday season. The current cold is set to last through Friday with lows in the double-digit negatives before warming up Saturday and heading into above normal temperatures with lows well over 0 to the positive side by Sunday. Figure 1 | Alberta Temperatures from WSI Trader With heating demand up, load for the region reached over 12 GW on Monday and Tuesday. These are some of the highest load conditions we’ve seen in AESO, only comparable to this past January when load ... » read more
Tuesday Dec 20, 2022   
After the rupture at the Freeport LNG facility back in June the plant made claims that the liquefaction would resume in short order and that the issues surrounding the problem could be easily remedied. The plant is now seven months past the rupture date and still there is no solid time frame for its return. At every turn the plant has been met with more data and information requests from the Pipelines and Hazardous Materials Safety Administration (PHMSA). But now the Federal Energy Regulatory Commission (FERC) has entered into the fray by making the latest data request. On December 12 FERC sent a laundry list of items that they need to investigate before they would grant license to operate. Immediately Freeport started sending in data but as we are all aware of, completing things ove the ... » read more
Monday Dec 19, 2022   
Waking up on Sunday and seeing Portland’s weather match that of Houston is all you need to know when it comes to the conditions on the grid. If you throw in the simple fact that the Pacific Northwest has been witnessing below-normal temperatures throughout December, the edge-pieces of the puzzle would be in place for a frigid Lower 48 outlook as the holiday season is upon us. Figure 1 | ERCOT Degrees From Normal Forecast This is clear from the image above, which displays the weighted average temperatures and their degree from normal 15-day forecast for the past two weeks.  The colder weather has been on the radar screen for some time but what is clear is that as of last week, the transition from cold to really cold was in play over the holidays.  This is shown by the ... » read more
Friday Dec 16, 2022   
If you’ve read our latest monthly Renewable Report, you might have seen the metric we track for the percentage of wind generation which occurs at negative West Hub prices. We track this metric in particular (as opposed to, say, wind generation occurring at negative Houston Hub prices) because most of ERCOT’s wind generation is installed in the West Hub, and so wind blowing in the western part of the region tends to be a large driver of increasing supply on the grid to a point where West Hub prices can drop below $0/MWh. Unsurprisingly, during the relatively low-load months of October, November, and December, the percentage of wind gen at negative West Hub prices has been significant over the past few years. However, looking at this metric prompted the question, what has solar ... » read more
Thursday Dec 15, 2022   
Growing up as a kid right here in Portland, Oregon, every December was the same story of waking up each morning with fingers crossed in hopes of the rare event of a snow day, to spend the morning making snow angels and chucking snowballs instead of normal school drudgery.  With the forecast turning even chillier on the other side of this weekend, the Northwest is looking at this possibility next week.  As we reach the midway point of the month of December the conversation continues around energy and natural gas markets in the West, and the Pacific Northwest in particular.  The extended period of cold temperatures that have settled over the western US continues to put system operators and traders alike in the position of weighing the immediate needs of today versus the ... » read more
Wednesday Dec 14, 2022   
It was a race to the cap in Alberta during the peak hours on December 12th, 2022 as the real-time settles blew past $500/MWh in the early morning hours, stayed over $700/MWh for several hours in the morning, and peaked just under the cap at $987.89/MWh in hour ending 18. The grid is no stranger to these conditions, as below-normal temperatures have smothered the region since early November and wind generation continues to display volatility that tightens the supply stack.  An example of such tightness was on display at the end of November 2022 when the system operations sent out emergency alerts that were heightened to the most extreme level before matters were going to be taken into their own hands for grid reliability (EEA Levels 1-3).  Over the course of the last ... » read more
Tuesday Dec 13, 2022   
The western half of the Lower 48 has garnered plenty of news of late as fears of gas shortages have developed ahead of a coming polar event. Prices for physical gas have soared from $7 to $90 as of Friday's close. But now the same polar event that is expected to dominate the West is now progressing across the continent. Recent weather model runs have moved the pattern over the Midwest and into the Mid Atlantic prompting fears of zonal binding in the metro delivery areas along the East Coast. The pipeline in the crosshairs is the Transco Pipeline which runs from the Gulf up to the New York metro area. Transco is prone to binding as demand outstrips supply during extreme events. This past summer saw Zone 4 and Zone 5 binding causing price spikes throughout the ... » read more
Monday Dec 12, 2022   
The West natural gas market has been on an upward trajectory since the start of the month as the balance of the month settled near $90 as of Friday, December 9th, 2023.  This is after the cash market moved out from the $15 level to $45 for the three-day weekend package. As a result, the power sector is now seeing the bilateral market clear north of $425 and the CAISO auction deliver a $440 print in NP15 for today (Monday). Figure 1 | SoCal Gas Sendouts and Storage The storyline for the natural gas movement all starts with the uptick in the overall demand in certain areas of the West and what it means to their respective storage levels. For example, the figure above displays the SoCal Gas Sendout levels in the left graph while the right graph represents the total natural gas storage ... » read more
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