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Wednesday Dec 30, 2020   
"El camaron que duerme se lo lleva la corriente"  The current carries away the sleeping shrimp.  This Mexican saying can be heard when someone is warning you not to sleep on an opportunity.   In recent years, the Mexican gas market has been an opportunity for the U.S.  In the modern shale boom era, the U.S.’ rise to prominence as one of the world’s top producers of oil and gas outpaced growth within the domestic demand market.  This compelled the need to look abroad for markets to consume swelling U.S. production.   In recent years, Mexico has become one such market.  But – as with LNG – as the volume of gas the U.S. exports to Mexico increases, the opportunities for Mexican market fundamentals to impact U.S. » read more
Tuesday Dec 29, 2020   
Oh how the tables can turn on natural gas so quickly. Most of the Midcon, Midwest and Northeast enjoyed a white Christmas this year as several snowstorms ran through the regions. It was the culmination of a recovery in winter weather which was off to a slow start. November saw record warmth putting fears that a repeat of last winter was in the cards. NYMEX Henry hub fell from $3.30 down to $2.39 in just three weeks. But since the beginning of December the winter sentiment had been changing. Along with it came a bounce in natural gas prices as expectations of a white Christmas and normal January developed. It was all dashed once the Christmas holiday passed. The weather models once again turned on the blow torch. This makes it over a year since the weather has had any sustainable below ... » read more
Monday Dec 28, 2020   
When you grow up in an area of the country where there was always snow on the ground during the holidays.  Once you move to an area of the country that has minimal chances of snow sticking while St. Nick comes down the chimney, your heart goes back to those childhood memories.  On Sunday night, it was peer joy to turn on the television for the Green Bay Packers vs. Tennessee Titans football game in the heart of the Midwest (Green Bay) and see the thickness of the white snowflakes sticking to the ground. Figure 1 | The Snow was Falling This is not something that is going to be seen as we turn the corner to the New Year as the 15-day weather has warmed to a point that the accumulated HDD numbers have shifted down substantially with the latest model runs. Figure 2 | WSI Run on Run ... » read more
Wednesday Dec 23, 2020   
The word switchyard has a variety of meanings if you look it up on google.  The one that is most common in the energy sector is tied to power generator where it lies directly adjacent to the facility.  It is almost similar to a substation but does not have transformers and only operates at a single voltage level.  It's main duty is the interconnection between generation and transmission.  The generator bus (fed via the step up transformer) switches and diverts the power ont the feeder busses at the other end of the yard before it is sent out into the grid via transmission lines. Figure 1 | High Voltage Switchyard - Electrical Facility When it comes to the actual generator type that feeds the switchyard, the source comes in a variety of constructs such as nuclear ... » read more
Tuesday Dec 22, 2020   
Typically as the weather transitions from fall into winter the jet stream becomes more amplified. This amplification brings cooler air from the northern latitudes down across the continent. But over the past year the jet stream has seen little amplification leaving the continent with no sustained cold events. Last winter and this winter have been mild as a result. Another consequence of this pattern in the jet stream is that it is favorable for wind output. Both last winter and this winter have seen boosts not only in the overall wind capacity but also in usage factor over previous winters.   Figure 1 | MISO, SPP and ERCOT Installed Wind and Output by Quarter Lower 48 wind output has set a number of successive records this year. This past November the output averaged 46.5 GWa ... » read more
Monday Dec 21, 2020   
The most noteable portion of the holiday season is upon us as Saint Nick is gathering the gift and getting his reindeer ready for the delivery down the chimneys.  In the energy space, we are looking at a white holiday season in the Northeast while the Midwest is staving off any big weather storm so far.  The South Central is walking a fine line between massive wind days that shift into the floor falling out from under it.  Out West, the temperatures in California have been moderate but are looking at some colder weather on the horizon.  The Pacific Northwest is swimming in precipitation and plenty of wind generation as it seems to be the gift that keeps on giving. Starting in the Northeast, last week delivered the first Nor'Eastern storm the jumped more snow than some ... » read more
Friday Dec 18, 2020   
On November 30th the Public Utility Commission of Nevada approved three new large-scale solar+storage projects. With this approval, NV Energy will meet its target of 1,000 MW of energy storage on its system. NV Energy submitted all three of these projects for approval with the Nevada Commission in July of 2020. The NV Energy filing with the Commission included the standard information about the projects. Interestingly, it also included detailed pricing. This blog takes a look at the implied dollar per MWh of the solar plus storage projects selected by NV Energy. The accompanying article for premium subscribers takes the math a little bit deeper and broader. It compares this portfolio of three projects to a benchmark combined cycle project, illustrating just how compelling the current ... » read more
Thursday Dec 17, 2020   
In the movie 'The Good, the Bad and the Ugly', three men set off during the American Civil War to find two hundred thousand dollars in buried gold coins.  The film was marketed as the third and final installment in the Dollars Trilogy following a Fistful of Dollars and For a Few More Dollars.  It was a financial success growing over $25 million at the box office and it is credited with having catapulted Clint Eastwood's acting career and eventual stardom for decades to come. Figure 1 | The Good, the Bad and the Ugly In the energy space, this week has presented a similar trio that has not made it to the box office yet but definitely the internet and conversations across the internet as everyone continues to either work from home or in an office that is currently at no ... » read more
Wednesday Dec 16, 2020   
The idea of having white ground cover over the holidays might actual happen in the Midwest/Ohio Valley and definitely the Northeast region as Mother Nature is sprinkling some colder temperatures along with precipitation which equates to snow hitting the ground. The former definitely has a lower percentage of sticking around as the light dusting can go away with a couple of degree swing in the forecast as current temperatures are having around the freezing level during the day and dipping slightly lower at night.  Currently in Minneapolis, there are light flakes coming down as temperatures sit at the 18 degree level with its daytime high expected to get up to 29 degrees.  In the likes of Cincinnati and other Ohio cities the current temperature is more like 29 degrees going on ... » read more
Tuesday Dec 15, 2020   
The warm weather conditions have been the story line for Lower 48 natural gas balancing for the first month and a half of this winter. November saw record above normal temperatures which delayed the onset of seasonal storage draw downs into this month. November ResCom demand would normally average 29 BCF per day. This past November posted at only 24 BCF per day. The warmth has been ongoing for about a year which was the last time the continent saw a sustained below normal event. The storage in the United States remains well above normal but that is not the case abroad. After reaching full capacity this summer European storage is on a pace for a record inventory draw. And because of the differing balancing dynamics between the two continents, futures prices have lost all ... » read more
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