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Wednesday Oct 17, 2018   
All the attention this past week has been tied to the Enbridge pipeline explosion that occurred just over a week ago.  We have seen Midc trade triple digits during the cash section Wednesday and ultimately index at $108.  This was a was a massive move up considering the prior day the same heavy load product settled in the upper $30's, which was quite bullish by itself as it traded basically flat to SP15.  It was no surprise that Midc had to run up to the triple digits trades as many of the natural gas power plants on Northwest Pipeline were not able to get the gas needed to produce electricity on the grid.   The bottom line is the Pacific Northwest entities were scrambling to get the power to stay at home, which meant you had to price aggressively until the price ... » read more
Tuesday Oct 16, 2018   
It was not long ago when the Sumas delivery point was one of the most volatile points on the continent. It was a landlocked delivery area that secured most of its supply from the Rocky Mountain region via Northwest Pipeline. During the winter months when space heating climbed along the I-5 corridor, British Columbia used the receipts from Northwest Pipeline to meet is own heating demand. That created an island effect at Sumas which forced it to scarcity premiums in the cash and term markets. With the recent rupture of WestCoast Pipeline (which was discussed in our latest EnergyGPS Newsletter Article called 'SOS - Sumas Over SoCal Citygate') which runs from the BC foothills to the US Border, we are seeing Sumas Island once again. The I-5 corridor is having to meet its supply needs by ... » read more
Monday Oct 15, 2018   
In the National Football League (NFL), the game is still known by the team logo/nickname such as the San Francisco 49ers, Green Bay Packers, New York Jets and New England Patriots.  In fact, when you head to the games all you hear on your way into the stadium are chants like Go Pack Go or J-E-T-S, Jets Jets Jets.  There are a few mortal icons that when their name is stated you stop and go yes, he changed the game.  For example, if I said the word Montana, the mind immediately goes to the championship years in the 80's when the 49ers were the best team in football.  If you are an avid football fan, you might even dip back into the college ranks when Montana led his Fighting Irish to a comeback win in the Cotton Bowl again Houston.   Turning to the Packers, one ... » read more
Friday Oct 12, 2018   
I’m a student of electricity markets – I have been for 25 years. The changes we’ve seen in the last five years have been tremendous. The era of coal is being gradually ushered out by low-cost renewables. The vertically integrated utility used to control everything – both the load and the supply. FERC policies opened up the transmission system to independent generators. State policies, in some areas, opened up the retail sector to competition. In today’s market we see a broad array of generation owners – renewable fleet ownership is much more distributed than the traditional thermal generation fleet was 10 years ago. There are many more buyers in the market now as well. Many markets have direct retail access. In addition to the direct access demand ... » read more
Thursday Oct 11, 2018   
The Algonquin Pipeline recently reduced capacity throughout maintenance season. While the majority of outages kept capacity above 1 Bcf/d, there was a short segment of work that needed a much greater reduction taking the Stony Point Compressor Station to just 736 mmcf/d. The major outage had been continually pushed back with work initially being scheduled for the spring. After being moved to fall due to cooler weather in the first quarter of the year, the outage was scheduled for September 25th to October 12th. However, further complications in New England drove operators to increase capacity along the pipeline much earlier than expected. The pipeline issued a notice on October 4th that capacity would be restored the following day. Looking at Figure 1, we can see that capacity began to ... » read more
Wednesday Oct 10, 2018   
A couple of years ago, the Alberta Power Pool (APP or AESO), was a forgotten market as the supply stack was full of coal operated assets and the natural gas component was somewhat steady as the Marcellus/Utica production was keeping the price at AECO at moderate levels.  This all changed last year as the pipeline maintenance tied to TCPL impacted the gas distribution system to a point that entities could not put the molecules into storage.  This wreaked havoc in the cash market as a glut of supply did not have a home, so the only option was to price the spot market accordingly so the gas would be shut-in from the production fields.  Their was only one problem, the natural gas incremental supply was coming from associated gas plays as well as new wells in the northern part ... » read more
Tuesday Oct 9, 2018   
There is one last storm headed for the Gulf Coast before we typically end the hurricane season. The National Hurricane Center has the track moving into the Florida Panhandle. There are a number of risks from the storm effect. Production is the immediate concern with Transco, Sonat, Destin and Discovery in the vicinity of the storm. After that the damage risks extend to the coast with processing and refining facilities to the west of the track and the Southern Company service territory dead ahead.  Figure 1 | NHC Hurricane Michael Storm Track In previous storm events we have seen up to .6 BCF of volume drop off the total. As of right now we estimate only .22 BCF has been shut in. If the track shifts to the west we will see additional volume come off the system. A move towards Mobile ... » read more
Monday Oct 8, 2018   
If you have ever been to Spain, especially Barcelona, a drink of choice in the summer months is called Sangria.  It is a mixture of brandy, red wine, some lemon and orange juice, sugar and the the every popular Triple Sec liqueur all swirled together with fresh fruit in a pitcher waiting to be poured.  Triple Sec is a strong, sweet and colorless orange flavored liqueur enjoyed by many when they are out and about enjoying a cocktail other than Sangria, such as a Margarita, Kamikaze, Spiked Long Island Iced Tea or a drink called a Side Car. Figure 1 | Triple Something - Sec, H and A If you are a World Wide Wrestling fan, you might have hear of the iconic Triple H as he was once the face of the franchise during several Westlemania events across the country.  Turning to ... » read more
Friday Oct 5, 2018   
The U.S. power grid is undergoing a unprecedented transformation with the integration of renewable energy resources and the retirement of many base load fossil units, especially coal.  By most accounts this transformation is far from over: renewables are continuing to grow and batteries and other new technologies are making their way onto the grid.  With all this change in the power sector, one thing has not changed much at all: the way you connect a generator.   Figure 1 | Get In Line...... Transmission-owning utilities and RTOs have been obligated to connect generators on nondiscriminatory basis since FERC issued Order 888 in 1996.  But buying grid access is not like other utility services that have posted prices.  An interconnection request begins a ... » read more
Thursday Oct 4, 2018   
During the shoulder months, the temperatures tend to shift into a comfortable range. With demand for air conditioning and electric baseboard heating remaining relatively low, demand throughout electrical grids subside. This is when generators decide to take time to perform routine maintenance. As facilities go offline, more costly units can be pulled into the market in order to meet even below average electric demand. We have seen this occurring throughout the ISONE with several maintenance outages currently in place. With so many outages across the system, the system has performed admirably. Although the locational marginal prices have increased, the market has managed to hold it together making the best use of its available resources. The first outage was not throughout the electric ... » read more
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