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Tuesday Nov 22, 2022   
For the past months there has been plenty of talk about how natural gas prices have surpassed the price of ethane, a natural gas liquid, in MMbtu terms. While there is no perfect substitutability between the two fuels there are scenarios where natural gas can be switched out as a feedstock in industrial applications in lieu of ethane. On the supply side it becomes more profitable for NGL fractionators to bleed ethane into the natural gas pipeline stream when the economic incentive exists like it does today. The ability for ethane to be supplemented in the storage balancing puts ethane on the margin in those areas where the fractionators enjoy the optionality of the natural gas stream.  Figure 1 | December Mont BV Ethane and NYMEX NG HH Settles for Aug-Nov 2022 Currently the natural ... » read more
Monday Nov 21, 2022   
The holiday season is upon us as the first of many get togethers with family and friends will be this Thursday and go through the weekend.  From the looks of things, the weather should cooperate across the country as the coldest days look to be behind us.  For those who live in Upstate New York, the warmer weather cannot come soon enough as the weekend snowstorm was one for the ages.   Turning to the South Central region, the colder days will be met with some warmth during the day along with an increase in the wind generation once again. Figure 1 | SPP 12x24 Wind Profile The figure above illustrates just how impressive the wind generation has been within SPP this November compared to the past couple of months and years.  The monthly shape represents the average ... » read more
Friday Nov 18, 2022   
The flu season is upon us as many have been rushing to get their seasonal shots as the strands seem to be more potent in 2022-2023 than in years past.  The flu can be something that disrupts your routine for days as a congested chest and cold symptoms turn into a fever and the chills.  Once all this is present and the over-the-counter medication does not relieve the pain, Zoom Care or an appointment with your doctor is in order to get a more potent prescription.  In the energy space, the CAISO system operator has been playing doctor when it comes to the growing pains brought about by the growth in the renewable technologies. For example, CAISO has basically fast-tracked the battery technology over the past two years as the rising need for flexibility during the evening ... » read more
Thursday Nov 17, 2022   
Each month as part of our Newsletter Platinum Plus package, we publish a report on the developments relevant to the renewable space over the previous month across the country, touching on CAISO and the West, ERCOT, SPP, and PJM in particular.  In our latest report, “October 2022 – Where the Wind Blows”, we discussed the explosion in wind production that set off during the last week of October but has extended through the first half of November as well.  The impressive wind performance was present in California but has been most eye-popping in the Southwest in ERCOT as well as to the North in SPP. Figure 1 | SPP 7-Day Average Net Load Focusing on SPP, the winds have been strong enough to push net load down to the lowest levels seen in the past three ... » read more
Wednesday Nov 16, 2022   
The holiday season is almost upon us. Turkeys, stuffing, and mashed potatoes will be laid out on tables across the country next week. And many will soon start shopping for presents to be wrapped up and placed under a brightly decorated tree come Christmas morning. In the energy business, this holiday season brings the wrapping up of the nuclear outage season and the gift is having baseload, low-carbon energy back on the grid.  With temperatures falling and heating demand rising, this will be a welcome return for many regions. This past spring, we at EnergyGPS revamped our nuclear outage forecast. The figure below is delivered daily to subscribers to our NRC nuclear report. Email if you’re interested in receiving these to your inbox. The figure shows historic ... » read more
Tuesday Nov 15, 2022   
The looming question over the head of the natural gas market over the past months is about the return of the Freeport LNG facility. And it should be as the terminal will consume up to 2 BCF per day of Gulf Coast natural gas when the go ahead is given to restart operations. In the meantime the molecules dedicated to tanker loadings and exports are being backed into the Gulf storage balancing. Since the rupture happened on June 8 the rejection of 2 BCF per day of feed gas has been the single biggest contributor to the rebound in EIA South Central storage inventory. Since the event occurred the storage inventory has climbed from .8 to 1.2 BCF per day. Absent the shut down the injections would have missed some 320 BCF of volume leaving the regions inventory at only .9 TCF. That would be a ... » read more
Monday Nov 14, 2022   
There was a time when the power markets traded in quarter and fifty-cent increments across the country, but those days are long gone as it is the natural gas space that has taken over the reigns of trading in such blocks.  Yes, you heard that correctly, the prompt month natural gas contract is not associated with quarter and fifty-cent moves rather than pennies and nickels.  For example, as of the early morning trading on November 14th, the prompt month Nymex contract (December 2023) is up $0.40 to place its outright level at $6.28.  This was after a holiday session the previous Friday saw the same month’s value move down roughly $0.30 on light trading. Figure 1 | Nymex Prompt Month Contract Source: CME Trading Platform There are several reasons for such volatility ... » read more
Friday Nov 11, 2022   
One problem that arises when considering the future value of a renewable resource is figuring out what the average price of electricity is likely to be over the next five, ten, or even twenty years. But even assuming that’s solved, another problem is figuring out how much of that average price a given renewable resource is likely to actually earn. Solar and wind, depending on the market, location, and a variety of other variables, often tend to generate more or less when the price is routinely higher or lower than average. For example, solar in California is only able to generate during the daytime when prices are low, or, on the other end of the spectrum, solar in Texas profits from price spikes tied to high demand during sunny afternoon hours. Estimating this can be tricky. There ... » read more
Thursday Nov 10, 2022   
Tuesday night people across the country plopped down in front of their televisions and computers as election results rolled in to watch as the lines across the map filled in blue or red with the announcement of each winner.  Americans tuned in to see if it was a red wave or a blue wave resulting after a long political campaign season.  Results are still being tabulated, but the one thing that is certain is that the Pacific Northwest won’t be dealing with a red wave where the weather is concerned. Figure 1 | 2022 House Election Map From the New York Times 2022 Election Map The region is in the midst of a blue wave of chilly temperatures and strong river flows ever since the atmospheric river swept into the region late last week.  The figure below shows a matrix of ... » read more
Wednesday Nov 9, 2022   
In the first week of November, following Nymex has been like riding a roller coaster. Usually moves are made in pennies, but the last week has been trading in quarters and 50 cent pieces. In October, Nymex wasn’t quite as volatile, but it certainly had its ups and downs. In our recent monthly report ‘Falling Only to Rise Again’, we explored the rises and falls of Nymex last month as well as power burns and other trends in natural gas and power markets across the country. Read on for a sneak peak into October’s monthly report and email if you’d like to receive the full November report straight to your inbox. The prompt month for Henry Hub fell for much of October, continuing the late summer trend as production was putting molecules onto the ... » read more
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