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| Friday Feb 12, 2021 | |
| We are looking at more tumultuous times in US energy markets. Over the last few days we’ve been writing about the cold weather enveloping the country. Temperatures in Dallas are projected to decline throughout the weekend. The forecast for Monday is a low of 2 degrees and a high of 15. And yes, we are talking about Fahrenheit. Natural gas prices in certain markets have risen into the double digits. Pipelines are experiencing deliverability challenges and intra-day gas supplies are uncertain and volatile. This is a bona fide event in electricity and gas markets. I spend a lot of time working on ERCOT wind and solar transactions. I have a soft spot in my heart for the players in that market. I worry about the unhedged project when prices are low. I also worry about those with fixed ... » read more | |
| Thursday Feb 11, 2021 | |
| The weather forecast in Portland, OR over the next 72 hours is calling for the streets to be blanketed with snow and the daytime highs to not get over the freezing level on Friday. It happens a couple of times each winter, when the schools close (wait most schools are not in session), sporting events are postponed (once again already happening) and everyone works from home due to the icy conditions on the road (hmmmm, already doing that). I guess the world we live in can look very different in many ways as the COVID 19 virus is still in play. What does not seem to change is how the natural gas and power grids are impacted by what Mother Nature brings to the table in form of the winter weather. Figure 1 | Winter Weather Warning During a mild winter, there is a lot of looseness ... » read more | |
| Wednesday Feb 10, 2021 | |
| Just three winters ago, the Sumas price hub in the Pacific Northwest set that winter’s high-water mark for regional gas prices due to an explosion on an upstream supply pipeline causing severe downstream shortages. After those issues were resolved it was generally regarded that all was in the rear-view mirror. Even with this winter featuring numerous cold periods, no major gas price spikes have cropped up as the PNW seems sufficiently supplied. Headed into this current week, there were no expectations of any major price swings as, even though the coldest temperatures of the winter are en route, the region projected to be well supplied. That all turned on a dime this weekend, though, when the same upstream supply system that caused the Winter '18-'19 ... » read more | |
| Tuesday Feb 9, 2021 | |
| Over the past week there has been plenty of focus on the coming polar event that will run through the Lower 48. But that cold air has already made its effect north of the border. Alberta has been feeling the brunt of near record cold temperatures throughout the province. Departures are 35 degrees below normal at minus 20 Fahrenheit. This is as cold as it has ever been pushing the Nova system demand to record levels of over 7.5 BCF per day. Extreme conditions have also caused natural gas production to freeze off. Receipts are down from 11.8 to 11.3 BCF. This has taxed the supply/demand balancing forcing storage draws to their highest point on record of 3.4 BCF per day. With little storage withdrawal capacity left the market has to price back pipeline exports to satisfy native demand. » read more | |
| Monday Feb 8, 2021 | |
| Every since last January (2020), the Alberta power and natural gas markets have been on the radar screen as the month was one of the coldest on record. If you recall, the middle third of the month was nothing but unbearable as the daytime high temperatures did not surpass minus 10 degrees. The last I checked that is arctic cold, even for a guy who grew up in the Midwest where the wind chill was so cold it made your eyelids freeze as they watered walking around the corner of a building. Cold weather wreaks havoc on the power and natural gas grids as the former is battling units staying online with the morning and evening ramp blocks showing high hourly demand numbers. The latter has two key components that drive the balancing, the first is the colder weather impacts ... » read more | |
| Friday Feb 5, 2021 | |
| By Tim Belden Skyrim! What is Skyrim you ask? It was the roleplaying video game that I bought for my then-sixth grade son eight years ago. We drove together to the mall and made our way past the Cinnabon, the Sunglass Hut, Footlocker, and the candle cart to my son’s favorite store on earth – GameStop! It was a small, unremarkable store, but it sold all the video games a middle schooler could desire – both new and used. After a few minutes of browsing and asking a couple of questions related to compatibility we were on our way home. When we got home, I promptly lost my son to hours of online adventures. I was intrigued by the Game Stop store and the business model of selling new and used games. I did a little bit of research on the company and decided to make a modest ... » read more | |
| Thursday Feb 4, 2021 | |
| The Lone Star State gets a lot of attention as it's slogan is such that 'everything is bigger in Texas'. Little did the state's founders realize that it would pertain to the renewable energy sector known as wind generation. Over the years, the Texas electricity grid (ERCOT) has been adjusting to developers racing to get their turbines up and running to capture the federal production tax credits. The widespread attraction started out in the west, then transitioned to the middle of the state before heading north. The latest move saw the southern zone see a massive influx of wind capacity due to the offshore winds providing a better hourly profile compared to inland facilities (farms). At the end of the day, ERCOT has moved into the top slot of wind capacity ... » read more | |
| Wednesday Feb 3, 2021 | |
| Last week presented this winter’s first legit cold snap and gave a glimpse of what we may expect later this week and most of next week with another, more intense cold spell expected to arrive. In fact, next week could feature some of the coldest temperatures in two winters, bringing volatility back to the market. Going around the horn and starting in the Northeast: up in New England, the cold spell lifted Algonquin Citygate cash price over $11, its highest levels since December 2019 in order to inspire regional gas plants to forgo consuming gas so that molecules can serve the res/comm sector’s need to generate heat. New England power prices had to rise to more than $90 to make it economical to burn fuel oil for power generation. With power that ... » read more | |
| Tuesday Feb 2, 2021 | |
| The natural gas market was turned on its head over the weekend when the weather forecast added 20 HDDs to the 6-10 day forecast. The week was already expected to be the coldest of winter but now if the weather holds it will turn out to be one of the coldest periods experienced over the past three years. February 8 is expected to be the coldest day of the coming stretch with an HDD total of 39. The highest HDD day over the past five winters was on January 1, 2018 when a 45 was recorded. The market has been waiting for this event for over a year. As noted in Figure 1, winter never arrived last year with only a handful of days above climatology. This year started warmer but now has one of the coldest weeks of the past ten years on deck. Figure 1 | Daily HDD Totals for ... » read more | |
| Monday Feb 1, 2021 | |
| MeatLoaf is a band that continues to have their music play on Apple Music, Spotify, Pandora as well as certain Rock Music radio stations across the United States and other parts of the world. One album that grab the attention of many was titled 'Bat out of Hell' which is the 1977 debut by the American rock singer and composer Jim Steinman. Searching on Wikipedia, the story is told that the album was developed from a musical, Neverland, a futuristic rock version of Peter Pan, which Steinman wrote for a workshop in 1974. The next two years were spend recording the album at various studios, including Bearsville Studios, Woodstock, NY and eventually released in 1977 by Cleveland International/Epic Records. The album's musical style is influenced by Steinman's ... » read more | |