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| Friday Jun 23, 2023 | |
| Over the past few days, we have published a couple of newsletter blogs as well as a Market Flash discussing the recent price action in ERCOT, when Real Time prices hit the cap in several hubs. Figure 1 | ERCOT RT Dashboard, 6/17/23 – 6/23/23 The contributing factors to the price spike on June 20th have been well-discussed in the blogs linked above, but another interesting day is the 21st, where pretty much the exact opposite happened compared to the 20th. Starting in the top pane, which shows DA prices in blue and RT in orange (for the North Hub), the RT prices shot above the DA for the afternoon and evening on the 20th, but then in RT on the next day, the prices never got off the ground compared to the DA action. Moving to the next pane, the blue line shows RT load and the ... » read more | |
| Thursday Jun 22, 2023 | |
| A couple days ago on Tuesday there was plenty of excitement down in Texas, when the real-time prices shot up in the early afternoon well above the DA market clear and remained elevated until after 8 pm, reaching the price cap of $5,000 for over an hour. It’s not the only piece of the puzzle, but one of the factors that can drive these unexpected spikes in real-time prices is when more load shows up than forecasted or when less wind supply is produced than projected. Both of these were in play on Tuesday afternoon, as shown in the figure below. The “Wind Delta” pane of the figure shows actual hourly wind generation less the day-ahead forecast, with a similar calculation for load in the “Load Delta” pane below. On the afternoon of ... » read more | |
| Wednesday Jun 21, 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 versus power demand ratio 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. In the special report, Missing in Action – SPP Wind?, we explore the impact of the missing wind on the SPP grid and explore whether Figure 1 | SPP Wind Generation – Gone but NOT Missing The figure below represents the 12x24 wind, load, and net load profiles for SPP for the past three years with the blue line representing 2021, orange ... » read more | |
| Tuesday Jun 20, 2023 | |
| Texas has carried the motto ‘bigger is better’ for years as its outdoor BBQ festivities cannot be matched, the oil industry speaks for itself, and the electricity grid operation stands on its own to this day. Each one of these components has been tested over time but to this day the slogan still stands. Figure 1 | Texas Bigger is Better Prior to Storm Uri, the electricity operator (known as ERCOT) stood at the top of the mountain when it came to sending a price signal to initiate new build to work its way on the grid. In fact, the price cap of $9,000 was a welcome sight come the summer months when the heat moved in and power demand rose to levels that would once stretch the thermal stack to the cap limit. With the evolution of renewables and coal retirements, the ... » read more | |
| Monday Jun 19, 2023 | |
| Every four years, athletes from around the world gather to compete at the highest level in events that are tied to summer and winter sports, such as track and field, skiing, bobsledding, figure skating and basketball to name a few. The lighting of the Olympic torch symbolizes the start of a two week stretch where competition is fierce, and medals are handed out to the top three athletes in each individual event and medals for the top three teams when pertinent. The lighting of the torch also carries an Olympic slogan where the words ‘let the games begin’ ring through the television announcer’s voice. Figure 1 | Let the Games/Heat Begin The energy sector does not have to wait every four years for a competitive environment between Mother Nature and the ... » read more | |
| 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 | |