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Friday Dec 2, 2022   
The US natural gas pricing environment has softened a bit over the past couple of months, but it was not too long ago that double digit prompt month ticks were part of the daily conversation.  In other parts of the world, they wish their natural gas price was in price range but with the push for renewables, coal retirements and now the Russia/Ukraine war, the fact of the matter is Europe went into the winter with high prices and concerns over not having enough if the weather turns cold, let alone extremely cold.  The massive natural gas spreads that have extended over the Atlantic have led to the US now fully invested in the liquified natural gas (LNG) sector with the first wave of facilities up and running and an incremental 6.5 BCF of nameplate capacity under construction and ... » read more
Thursday Dec 1, 2022   
As we officially take our first step into December there are changes aplenty taking place across the country as the air grows brisker and yuletide carols blaring over the car radio.  Taking a walk around the neighborhood at night I see more and more houses adorned with lights and the bright colors shining out through living room windows from newly decorated trees.  Millions of folks all across the country will be feeling the holiday cheer as I did this past weekend when I rummaged around in the basement for last year’s strings of lights, unfurled them and plugged them in to find half the lights were not working, spent an hour trying to identify the one or two defective bulbs before chucking the whole string in the bin and heading over to Home Depot to buy a new ... » read more
Wednesday Nov 30, 2022   
The SPP market continues to deal with its fair share of wind generation, especially when compared to the overall demand across the North and South region.  As far back as October, the system operators have resorted to renewable curtailments to balance their grid often.  The block of hours that have less exposure to such curtailments are those associated to high demand which in the winter usually is tied to colder weather moving through the central vertical third of North America.  In recent weeks, the SPP grid has also seen the two nuclear units return to full capacity as their respective refueling maintenance period has ended, adding roughly 2.0 GWa of baseload energy that falls in the ‘must run’ category.  Over the long holiday weekend, SPP’s ... » read more
Tuesday Nov 29, 2022   
Over the past decade PG&E has made a number of changes to reduce operating costs on their gas distribution system in order to fund the growing costs attributed to renewables transition as well as the most recent bankruptcy settlement. Some of those decisions included the retirement of two gas storage fields at Los Medanos and Pleasant Valley as well as the reclassification of 51 BCF of working gas over to base gas. The retirements and reclassifications were done in the aftermath of the Aliso Canyon rupture in Southern California which has forced more reliance on import pipeline capacity to meet the natural gas demand needs in Northern California. The decision to remove of gas storage capacity has now come home to roost as PG&E has not only entered into the withdrawal ... » read more
Monday Nov 28, 2022   
The month of November flown by rather quickly as December 2022 is right around the corner.  If you lived in Western Canada or the Pacific Northwest portion of the Lower 48, you have dealing with well-below normal temperatures throughout and the last few days of November are no different.  In fact, we see the start of December to look like that of November as Mother Nature is continuing the trend of brisk overnight lows across both regions and extending into the Rockies and Northern California. This is going to keep the balancing act around molecules and megawatts quite interesting as the systems that once delivered power to other regions will be pricing themselves to keep the units at home. Figure 1 | Chilly November/Start of December 2022 Starting with natural gas, all trading ... » read more
Wednesday Nov 23, 2022   
Last Friday, the EPA announced a decision to deny General James M Gavin Power Plant an extension to continue disposing waste in an unlined coal ash pond. Located in Ohio and serving PJM, the plant is the ninth-largest coal plant in the country with a capacity of 2,680 MW. The decision comes from EPA’s Coal Combustion Residuals rule which aims to protect groundwater from contaminants, such as mercury and arsenic. Plants were given until April 11, 2021 to cease waste disposal in these ponds or upgrade their management by using lined ponds, closing unlined ponds, and monitoring groundwater contamination. Over 50 plants filed for an extension and the Gavin decision is one in a string of decisions from the EPA over the last several months. Figure 1 | General James M Gavin Power Plant in ... » read more
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
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