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Friday Jan 13, 2023   
It’s time for our 2022 renewable awards issue of the Energy GPS blog. What a year it was. The corporate sustainability groups are now profit centers. CFO’s at these corporations are preparing to explain to Wall Street where the millions of dollars of favorable vPPA settlements came from. The operations groups at renewable IPP’s with merchant exposure are reporting favorable results each month. The new “strategy” for renewable projects is to “go merchant” if you can. High prices can cut both ways. Some projects with regional basis risk have been crushed by the spreads – this has been especially true for projects with basis exposure in SPP North or ERCOT West. But, on the whole, a rising tide lifts all boats – and the tide was high in US ... » read more
Thursday Jan 12, 2023   
Even as the weather has started to change over the past couple of weeks, energy markets in the West continue to bear the fruit of the abnormally cold and dry fall and winter leading up to this point.  From California all the way over to Utah is enjoying the buckets of precipitation and snowfall from the atmospheric river phenomenon that has turned on the spigot to California river flows as well as snowpack in the Sierras and southern Rockies.  The entire West has seen the thermostat climb as January has delivered conditions as warm and mild as they were frosty and cold in the preceding months.  The changes are lessening the squeeze, but after a dry and frigid end to 2022 the effects are still very present in the form of depleted natural gas reserves—especially for ... » read more
Wednesday Jan 11, 2023   
Each year goes out with the bang of fireworks as people celebrate the new year across the world. The end of 2022 was marked by more than the bang of pyrotechnics with a winter storm that raged during the holidays and western natural gas prices rising at an astronomical rate. In Alberta, the Pacific Northwest, and California, the extended and bitter cold throughout the month culminated in a battle of the megawatts as the whole West felt the rising heating demand. CAISO’s thermal fleet took the brunt as high price signals in surrounding regions pulled from the ties. Alberta hit a historic record of demand triggering emergency alerts while the Pacific Northwest competed for megawatts with their own ice storm just before Christmas. The eastern side of the country saw their fair share of ... » read more
Tuesday Jan 10, 2023   
Starting around the holiday season (end of December) and continuing on into the New Year, PJM coal output has done adisappearing act. The climb seen in December 2022 can be attributed to the simple fact that the region was staring at an extreme weather pattern leading up to the holiday season.  Once that storm passed, Mother Nature reversed her course by bringing warmer weather into the fold to which quickly dropped the net load numbers across the region. Due to retirements over the years and the moderate weather, the current coal megawatt output is record breaking to start the year and it comes at a time when natural gas storage inventories across the regions have started to swell.  Since the thermal stacks have been evolving over the years as more coal plants retire ... » read more
Monday Jan 9, 2023   
The ERCOT grid has plenty of sunshine to go around, hence why so many people enjoy living in the Lone Star State.  Over the years, solar farm developers have enjoyed the blue skies as well given the overall capacity being captured by the sun’s rays has increased roughly 3.0 GW since the end of 2021 where it sat just under 7.0 GW. Figure 1 | ERCOT Monthly Solar Breakdown This is a similar growth pattern seen in 2021 which was a step up from the 2.0 GW spurt the prior year.  Once can see the ERCOT solar growth in the graph above as the cumulative peak generation is represented by the line with each year a different color.  The bars below the line are the month average generation from the solar farms whereas the top pane is what we call the capacity factor which is ... » read more
Friday Jan 6, 2023   
By Gwendolyn Buchanan   You don’t need to have been following energy markets in great technical detail over the last few years to know that California’s seems to face constant challenges. Demand keeps growing, with the latest all-time record set this past September. Drought contributes to low hydro availability, not only in CAISO but in the entire WECC. Wildfires pose a risk to electricity and gas infrastructure, and in turn, gas pipelines and power transmission lines can potentially spark wildfires. Figure 1 | Kathernine Blunt's Book - California Burning   It's this last point that WSJ reporter Katherine Blunt dives into in her book California Burning, published this past August. More specifically, after opening with a description of the 2018 Camp Fire, she ... » read more
Thursday Jan 5, 2023   
After an unusually dry start to the 2023 water year-not just in the Pacific Northwest, but throughout most of the Western United States—it seems like the tide has turned, just in time as the calendar flipped over to the new year just a few days ago.  Over New Year’s weekend, California was hit with a significant storm and is bracing for another atmospheric river borne weather event this afternoon that is expected to bring extensive rain, winds, and widespread flooding to the region.  Over in the Mountain West, the story has been a massive blanket of snow dropped across Utah and Wyoming.  Utah’s Sundance ski resort saw 42 inches of snow added to the slopes over a 48-hour period.  The story up in the Northwest is different, however.  While the PNW ... » read more
Wednesday Jan 4, 2023   
In the week before Christmas, PG&E CityGate started Monday at $30, jumped over $40, fell to $25, and then was up to $57 all before the holidays were over. Western natural gas prices were a roller coaster in December with extended cold weather and tightness in the Pacific Northwest. Along with high gas prices and competition on the ties came elevated power prices. EnergyGPS has written about the opportunities for batteries in these conditions in ‘The Cheer - When I Root…..’, ‘Battery Battle Cry’ and most recently in the special report titled ‘Capturing the Arbitrage’. The high gas and power prices meant more chances to discharge at incredibly high rates and ultimately bring in more profit. While the opportunities were certainly available, the ... » read more
Tuesday Jan 3, 2023   
Welcome to 2023! The last weeks of 2022 ended with a bang. After weeks of building cold throughout the Midwest and East the stars aligned sending polar air down into the Lower 48 for the Christmas holiday weekend. Temperatures plunged to negative territory throughout the Midcon, Midwest and Northeast. Chicago and parts of the Ohio Valley saw overnight lows dip to minus 12 degrees just in time for Christmas. The cold sent total Lower 48 ResCom demand to 58 BCF and total Lower 48 gas demand to record territory. This week the EIA will publish the storage inventory change from the demand event. The expectation is for a 265 BCF draw from the caverns. This change in storage inventory also includes the largest single production freeze off on record with 15 BCF of receipts forced off the pipeline ... » read more
Friday Dec 30, 2022   
Throughout this past year, we’ve published market flashes, blogs, and articles centered around ERCOT’s new ORDC rules, and comparing what prices would have looked like under the 2021 rules to what actually played out this year. Today, we’re revisiting the scarcity event that occurred in ERCOT over the holiday weekend, and again asking the question, what would this event have looked like in 2021? First, an overview of the event: Figure 1 | ERCOT Real Time Dashboard, 12/19/22 – 12/25/22 Prices in the real time market (orange line, top pane) jumped on the 23rd as load had been climbing the entire previous day, hovered around 70 GW overnight, and didn’t truly let up until Christmas Day. Meanwhile, wind generation was not only falling steadily all day on the ... » read more
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