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Tuesday Sep 15, 2020   
Today is landing day for Hurricane Sally. The storm is expected to hit as a category 2 hurricane on the Alabama Coast and immediately weaken back to a tropical storm. Unlike Hurricane Laura this storm is going to move over land very slowly dropping heavy rains throughout the Southeast. As a result NOAA is forecasting "catastrophic flooding" on their latest discussion with rainfall totals exceeding 6 inches from the Alabama shore all the way into the Carolinas. We will have to wait until next week before the the remnants have cleared out to the Atlantic Ocean. Electric demand will suffer during the event with Entergy, Southern Company and Duke Energy all seeing downward revisions in load.  Figure 1 | NHC Track for Hurricane Sally The storm effect will compound what we see as an ... » read more
Monday Sep 14, 2020   
It has been a couple of weeks since Hurricane Laura rumbled through the Gulf of Mexico and made landfall in the heart of Cameron Parish, LA.  The point where the winds and rain swirled from water to land was at the heart and center of the Liquified Natural Gas (LNG) facilities known as Cameron and Sabine.  A couple of days prior to the storm moviing onshore, thre region was evacuated where both facilities shut down operations which saw their gas noms shift down to zero.  This left anywhere from 2 to 2.5 BCF of natural gas swirling around the grid and needing to find a home, along with the molecules that were tied to the power plants and processing plants in the region that were hindered by power outages and flooding. Figure 1 | Cameron Parish - Hurricane Laura Since the ... » read more
Friday Sep 11, 2020   
I see a lot of numbers in a day – prices, volumes, heat rates, spreads, shape values, and many more. Sometimes the numbers are harmonious with one another. Sometimes there is dissonance. In the last couple of weeks, if the numbers that I’m looking at were musical notes, they would sound more like a third-grade school band concert than the New York Symphony. Nothing gets under my skin faster than what I call a “jacked up vendor curve.” What is that you ask? There are a small number of “bankable” curves put out by large energy analytics shops. These vendors publish hourly curves going out through 2050. Some provide 8760 hourly values for each year. They have an hourly price for Hour Ending 13 on January 16th 2042 and a different hourly price for Hour ... » read more
Thursday Sep 10, 2020   
With all that is going on in the world these days, it is hard to believe that another element could be added to the mix as wildfires ravage vast areas of wilderness and demolish towns/communities in each path's way.  For example, in Portland and Washington State, four towns have been totally demolished by fire where several other local residents have been asked to evacuate or be ready to leave on a moments notice.  This type of fear and sadness is additive to what society has been dealing with on the Covid19 front and recent heat events that have left some without power for a short period of time.  The chaos is intense every step of the way as both doctors and nurses have been running full steam ahead for months and now have been joined by the firefighters on the front line ... » read more
Wednesday Sep 9, 2020   
Portland saw a rare occurrence late Monday afternoon/evening as in a matter of an hour, the city went from a nice sunny afternoon day to that of a wind storm that brought with it smoke filled air from the raging fires to the East and South of the city.  In fact, if you were taking a quick cat nap, you would have awoken to a scene in a movie were the skies were dark, cloudy and hazy while the trees were gusting winds up to 80 mph.  Needless to say, the old growth trees at the end of their life cycle did not stand a chance. Figure 1 | Damage from the Storm - Portland Since the power lines in/around Portland are not buried, the impact to the power grid created technical difficulties for many as power was lost Monday evening and through the night to where many residents like myself ... » read more
Tuesday Sep 8, 2020   
The impacts of Hurricanes Laura and Marco continue to be felt on the US Gulf Coast. LNG demand was expected to move up from 3 to over 5.5 BCF as we turned the calendar page but both Cameron and Sabine Pass terminals are yet to recover from the flooding and winds. With over 2 BCF of liquefaction demand off line combined with cooler temperatures the Henry Hub cash prices have plummeted to their lowest discount versus futures this summer. Over the long weekend the cash price dipped to $2.02 which was a 58 cents under the October futures. At that price carry every storage facility in the Gulf should be on maximum injection to monetize the carry. But the good times for storage operators may not last long.    Figure 1 | NYMEX Continuous and HenHub Cash  If the two ... » read more
Friday Sep 4, 2020   
No matter where you live and what you have planned, the weekend will hopefully be relaxing as it is officially a three-day holiday!!!  In years past,  Labor Day weekend indicated the end of summer and the start of fall where student went back to school and fall sports were in full swing at the high school and college level while the National Football League (NFL)was finishing up their preseason games and filling out their roster for the regular season.  This year is a bit different as the days intermix due to the Coronavirus adjustments made for the work environment as well as school for the kids.  With everything virtual, the classroom is brought to each student while us adults have learned how to better manage one's calendar schedule and almost every ... » read more
Thursday Sep 3, 2020   
Growing up as kid in rural Wisconsin, the activities that kept us occupied throughout the day were endless as there was always a creek to go dam up and create some sort of little hideaway to raking leaves in a big pile and jumping into them from the very tree that they fell from.  As you got older, the activities turned into playing car tag or for some it meant driving the rural roads knocking down mailboxes or litterally tipping cows.   Figure 1 | Cow Tipping If you were a part of the couragious group, you would head out of town and park the car so you could get out and make a b-line to the tramploline that was sitting on someones property and start jumping.  That quickly ended when the owners of the property made it known you were not welcome and needed to run as ... » read more
Wednesday Sep 2, 2020   
The ERCOT market saw a little excitement Monday afternoon as prices jumped over $1,600 during one afternoon hour only to be topped the next with 5-minute prints over $2,000.  This type of action has been few and far between this summer as the solar profile has doubled the capacity on the grid to which most hits right when the grid needs the energy.  The issue that still persists is the shape of the wind generation within the Lone Star state as the middle of the day takes a sharp turn down only to return by the end of the evening ramp.  Figure 1 | ERCOT Wind Hourly Profile by Month The graph above is an illustration of the hourly wind generation by month within ERCOT.  There is a definitely a V shape that goes on within each month with the months of July and August ... » read more
Tuesday Sep 1, 2020   
Driving around yesterday in the suburbs of Cincinnati, the number of "Help Wanted" signs in storefronts across town caught my eye as they were universal across a number of different business including the hardware store, restaurants, sporting goods and even the golf course. I could not help but wonder about the economy recovering from the COVID shock we experienced this past spring. Back in April and May businesses closed as government mandates forced a quarantine. But now just a few months later the anecdotal evidence suggests the economy is back on track and reverting to the tight labor conditions we experienced prior to the epidemic. These things should show up in the natural gas demand tied to the power burns industrial and commercial components of the supply/demand balance. » read more
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