Featured Articles
| Thursday Feb 11, 2016 | |
| In comparison to years past, the NEISO power market has struggled to get off the ground this winter with the strongest prices occurring on January 6th with a Mass Hub day-ahead clear of $66 for the On Peak Average (OPA). However, an interesting situation is unfolding in New England as the current load forecasts indicate we may see a new high clear for winter 2016, which so happens to be on a Sunday. This is just another indication just how warm it has been this winter when a Sunday beats out a weekday in the middle of February. Figure 1| ... » read more | |
| Wednesday Feb 10, 2016 | |
| Yesterday the HDD forecasts for the next 15 day fell slightly as the revised model runs indicated a quick thaw after the upcoming cold snap across the East this weekend. NYMEX hub traded down around 5 cents in response the the increase in temperature outlook. While the main focus remains on the upcoming demand event, we believe the true market risk is in the quick recovery and what it means for the remainder of the winter. Figure 1| Daily Gas Weighted HDD Delta from Normal - by EIA Region Overall the total US is on average ... » read more | |
| Tuesday Feb 9, 2016 | |
| As we start to move out of Winter and get closer to Spring, all eyes start turning to the California load and the solar profile to see how the middle of the day is going to shake out. In years past, it has not been a big issue because the solar profile was not a big, but since last year's installed capacity increase we are going to see more and more solar generation hit the grid. Figure 1 below, illustrates just how much solar is hitting the grid throughout the day and its impact to the next load in the CAISO footprint. Figure 1 | CAISO Solar, Wind and ... » read more | |
| Monday Feb 8, 2016 | |
| As expected the hydro generation in the Pacific Northwest shifted down over the weekend as the heavy load hours went from averaging 16,700 MW on the 3rd to settling in around 10,200 MW yesterday. Figure 1 | Pacific Northwest Hydro Generation The reasons for the big shift down over the past couple of days is due to the lack of precipitation in the region as a high pressure system has moved in. This has caused above normal temperatures along the Cascades and has kept the side flows at bay. The next reason is that the Canadian flows have backed way ... » read more | |
| Friday Feb 5, 2016 | |
| With warmer weather looming and natural gas production ticking up due to increases in the Marcellus/Utica region, the front of the curve has shifted down quite a bit over the past week with the March contract going from $2.30 last Friday to settling at $1.972 this Thursday. Breaking down the weekly information in a little more detail, here are the key drivers for such a move: Weather | As we walked out the door last Friday, the March contract pushed up to $2.30 as the forecasts were calling for some arctic air to move down into the Midwest and ... » read more | |
| Thursday Feb 4, 2016 | |
| We have been watching SoCal closely this week as colder temperatures swept across the West of the United States. While the forecasts were by no means extraordinary, we did have our eyebrows raised as it appeared the SoCal gas system going to be tight considering the daily average temperatures that were in the forecast warranted roughly 4 BCF of Sendouts in SoCal Gas's system The risk was twofold: First, withdrawals at Aliso Canyon had been limited as they entered into the 4th stage of the relief well drilling task to stop the leak in one of the wells. » read more | |
| Wednesday Feb 3, 2016 | |
| With front month contract trading below three dollar per mmbtu for a year now (as of yesterday, it is currently sitting at the $2.00 mark), it is not surprising to see gas drilling count taking another plunge. Gas drilling rig count in the US dropped to a new 5-year low of 121 count this past Friday. That is a 195 drop in gas rig count in just an year! Figure 1 | Natural Gas Drilling Rig Count in the United States, Year-on-Year Comparison The year-on-year drop is taking place across every shale. The largest decline is in Marcellus, followed by Haynesville, the ... » read more | |
| Tuesday Feb 2, 2016 | |
| The Columbia River and aluminum smelting have been inextricably linked since the 1940’s. In December 1939, BPA signed a contract with Alcoa to provide 32.5 MW of power to its smelter in Vancouver, Washington. Other aluminum smelters were soon constructed throughout the Northwest, providing vital material for the war effort and bringing industry and jobs to many corners of the region. Boeing was busy building warplanes and was a primary customer of Northwest smelters during World War II. It has been estimated that electricity from Grand Coulee Dam alone ... » read more | |
| Monday Feb 1, 2016 | |
| Saturday's CAISO auction clear gave us a glimpse of what might be in store come Q2 as load was down, solar was strong, in-state wind spiked and imports from the Pacific Northwest were plentiful now that the DC intertie is back in the mix. As a result, congestion on Path 15 showed up south to north as the excess MW tried to find a home. Figure 1 | Congestion on Path 15 S to N - 1/30/2016 As you can see in Figure 1, the bottleneck showed up between HE 10 and HE 15, which is right in the heart of the solar profile reaching its peak. Breaking it down, HE 7-12 ... » read more | |
| Friday Jan 29, 2016 | |
| Earlier this week we sent out a newsletter stating how the Pacific Northwest grid was going to be getting longer, well those days are upon us as load has shifted down due to above normal temperatures moving through the West. This has shifted the overall power load profile down across the majority of balancing authorities as well as heating demand. Figure 1 | Actual vs/ Forecast Weather - West Cities Up in the Pacific Northwest, the warmer weather impacted the supply side as well, specifically the hydro bucket where any precipitation was in the form of rain ... » read more | |