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| Friday Jun 16, 2023 | |
| Energy GPS has been reporting about how Washington’s Cap-and-Invest program began in 2023 with tight supplies (low cap) and strong prices. The first auction cleared $48.50 per allowance (one allowance covers one metric ton of CO2e emissions) and the bilateral market traded as high as $72 per allowance before settling into a range in the mid $60s. The Department of Ecology recently ran a second auction where the price cleared at $56.01 per allowance, up from the last auction but still below the bilateral price. Energy GPS has been modeling the Washington carbon market for the last 9 months. Our estimates show covered emissions will be well in excess of available allowances in any given year and in for the first Compliance Period (2023 to 2026). Stated simply, demand for allowances ... » read more | |
| Thursday Jun 15, 2023 | |
| The biggest story coming out of the region, known as the South Central, this spring has been the absence of wind generation within SPP and ERCOT. The former continues to lead the country from a wind capacity vs. power demand ration while the latter is the front-runner in total capacity so when Mother Nature delivers a weather pattern that knocks out the power generation from the wind turbines, it has an impact on the overall net load; to which the system operators must balance daily. Figure 1 | SPP Wind Generation – Gone but NOT Missing We put the spotlight on SPP in our latest Newsletter Special Report, “Missing in Action—SPP Wind?”, as there is a lot to pull on as Q2-2023 is coming to an end and Q3 is right around the corner. With every ISO, we ... » read more | |
| Wednesday Jun 14, 2023 | |
| The cap for Alberta power pool prices is $1000/MWh. When this price is reached, it signals all hands on deck because the supply is desperately needed, and all available plants should be running. Over the last 12 days, Alberta has reached the cap twice. The first time was last Wednesday when an emergency alert level 3 was issued, signaling that load would need to be shed imminently. The second time was on Monday when wind dropped to less than 100 MW and demand stretched to 10.9 GW. Several other days in this time span of less than two weeks experienced high prices as well with price peaks up to $900/MWh. Figure 1 | Alberta Hourly Breakdown (June 2nd – June 12th) While high springtime demand contributed to the problems in AESO as high temperatures reached into the 80s, this was ... » read more | |
| Tuesday Jun 13, 2023 | |
| Texas is looking at its warmest temperatures of the spring as the central part of the state (Austin/San Antonio) is tapping triple digits starting today/tomorrow and holding the pattern through the weekend. Both Dallas and Houston are not too far behind with the former in the low/mid 90’s while the latter matches the level mentioned along with its increasing humidity. Figure 1 | Texas Temperatures – Daily Average From a power perspective, the warmer temperatures are delivering strong demand with the later afternoon and evening ramp periods are escalating fast. In fact, the forecast shows the peak demand tallying 82.7 GW by the 16th with the heavy load average reaching 66.0 GW. Anchoring today as a comparison, we are looking at the peak increasing by 8.1 GW ... » read more | |
| Monday Jun 12, 2023 | |
| The energy space continues to present opportunities across North America as natural gas continues down the path of higher production volume and molecules being placed into storage. On the electricity side of the equation, we have the lever known as power burns that are derived from renewables netting out the demand across the grid along with being the balancing component when max storage injections are being met in the spring/early summer. Figure 1 | Lower 48 Natural Gas Storage Level – EIA The daily conversation is around the market fundamentals while the weekly/monthly discussions detail what is on the horizon when it comes to structural changes tied to regulatory/policy decisions centered around a specific commission or at the state/federal level. The changes apply ... » read more | |
| Thursday Jun 8, 2023 | |
| Our neighbors to the North have found themselves in the news more than they would probably like in recent days thanks to heat and wildfires that are causing reverberations across both Canada and the United States. Alberta is in the middle of a warm streak with temperatures into the 80s, which prompted wildfires across the region earlier this month. As of Sunday, the state of emergency was lifted as most of the fires were under control, but the warmth remains and is heating up the AESO energy markets. Unfortunately, on the other side of the country the wildfires situation is less controlled, as our readers along the East coast and around the Great Lakes can attest by looking out their windows. Smoke from these Canadian wildfires is spreading over much of North America ... » read more | |
| Wednesday Jun 7, 2023 | |
| After a flashy commercial with speeding cars down long stretches of highway and promises of high fuel efficiency, the same warning always plays- mileage may vary. Whether driving 70 MPH on empty freeways or stuck in traffic within city limits, so many factors go into how far a car will be able to go on a tank of gas. With energy the same concept applies as an extra megawatt of solar in the middle of the day is a lot less valuable in a region with abundant solar than a megawatt in the evening ramp or in a region with only a few gigawatts of solar. For regions with fish spill requirements, the same amount water could be much more efficient at generating power if it is sent through the dam when the spill requirements are not in effect. In our most recent eCommerce Platiinum (Package) ... » read more | |
| Tuesday Jun 6, 2023 | |
| ERCOT has been walking a tight rope when it comes to being the leader when it comes to wind generation making its way to the grid as the last two months have been trending lower with April’s 2023 profile looking more like 2021 while the May 2023 took a life of its own and sliced down to average just over 5.5 GW during the middle of the day. Figure 1 | ERCOT 12x24 Renewable Profiles The graph above is an illustration of the 12x24 wind and solar profiles within ERCOT for the past three years. Knowing that the capacity has not changed, in fact grown for both commodities mentioned, the last three months of wind generation is quite amazing as Mother Nature seems to know that the grid is swimming with the growing solar generation (seen in the middle pane profile). The ... » read more | |
| Monday Jun 5, 2023 | |
| The West energy markets always seem to have some sort of twist and turn that creates discussion amongst the market participants. For example, in years past the natural gas space was all about the lack of storage tied to Aliso Canyon and an aging El Paso pipeline while the Pacific Northwest dealt with its own pipeline issue around the rupture in British Columbia back in October 2018. This past winter was one for ages as the season started off with colder temperatures across the region, which led to early residential/commercial heating demand along with power burns. As a result, the California gas entities were under distress early and often as the power burns were not going to be the toggle to allow them to balance as the generation was needed. Figure 1 | PGAE Natural Gas ... » read more | |
| Friday Jun 2, 2023 | |
| Over the past two months, EnergyGPS has promoted it’s joint venture with Gary Ackerman, where the end game is provided market participants in the energy sector with a version of the ‘Burrito’ that incorporates all the usual sections Gary is notoriously known for along with a little spicy salsa of our own where we include an editorial on a topic of choice that should resonate with the audience. Figure 1 | The Burrito – EnergyGPS For those of you who do not know about the ‘Burrito’, it is 5-8 page piece of content that covers topics that make their way into the energy space but many times are outside the realm of the daily trading activity. The topics are just as important as they cover some of the root causes to how a market is being shaped by on the ... » read more | |