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Presenters: Jonathan Lee, Senior Energy Procurement Advanced Analytics Manager, and Denny Pearson, Senior Director, Supply Solutions with Ecova
Technical charts show strong uptrend across all major regions and forward indices when compared to 2012.
NERC Summer Electric Capacity Assessment: North America has enough power to meet
summer demand. However, Texas and the Western U.S. may have some problems. Expect volatility.
Other news:
Two LNG export terminals approved, operational in 2016-2017 timeframe. San Onofre nuclear power plant permanently retired. Wave of coal plant retirements hits in 2015.
Production
Demand Electric Power Sector Weather Tropical Storms LNG Economy
Short-Term Trend: With more power burn coming from coal compared to last year, (natural gas power sector demand down about 3 Bcf/d vs last year) gas storage injections have been healthy the last several weeks.
1,000 900
800
Rig Counts
700 600
500 400
300 200
100 0
Oil
Natural Gas
United States Oil/Natural Gas Drilling Rigs Drilling Rigs Current 6/14/2013 1,413 353 1,766 Last Week 6/7/2013 1,406 354 1,760 Change 7 (1) 6 1,405 562 1,967 Year Ago 6/15/2012 % Change 0.6% -37.2% -10.2%
Oil
Natural Gas Total
Pacific Northwest is continuing to have drier than normal conditions which are leading to some drought developments Oregon and Idaho areas. All of California is now considered in drought. Snowpack is listed at 15% of average. For reservoirs, currently the northern half shows slight below normal (~92%) and the southern half is still holding below normal (~83%) for reservoir levels against the YTD historic average.
Atlantic Hurricane Average Outlook Values June 01 - Nov 30 (1981-2010) Mild (Named Tropical Storms) Moderate (Hurricane Categories 1-2) Intense (Hurricane Categories 3-5) 12 6 3
2013 Projected Values 18 (CSU); 13-20 (NOAA 70% confidence) 9 (CSU); 7-11 (NOAA) 4 (CSU); 3-6 (NOAA)
Hurricane Induced Shut-In Production as a Percentage of Normal Monthly Production (1995-2011) 0.82% 1.15% 2.00% 2.98% 25.00% 35.64%
LNG export capacity is expected to ramp up from 0 to 9.5 Bcf/Day export capacity from 2016 through 2020 from 5-10 terminals (~10% of US consumption).
2012 was the lowest year in a decade for overall US pipeline expansions, but the second highest year in the Northeast. The industry added 3.2 Bcf/d, representing two-thirds of total capacity additions.
2013 is another huge push as gas from Marcellus tries to find ways into hungry NY City, CT, Massachussets Markets.
$/MMBtu $3.00 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 30-Apr 11-Jun 28-May $3.20 $3.40 $3.60 $3.80 $4.00 $4.20 $4.40 $4.80 $5.00
$4.60
14-May
NATURAL GAS
Retail Impacts
Texas
1 cent
New York
2 cents 1 cent
Middle Atlantic
.8 Cents
Northeast
1.5 Cents
California
1.3 Cents
North America has enough electricity for summer air conditioning season, but Texas and Western U.S. may have some problems. Texas has seen continued growth in demand and only small increases in power resources. Anticipated reserve margin is at 12.88% for the summer, which is below NERCs 13.75% target for this area. California (mainly San Diego and L.A.) may see some operational challenges due to the continued shutdown of SONGS. Especially if there is a prolonged heat wave.
Update: Fed indefinitely delayed a decision on restarting SONGS.
MW
MW
Total Capacity of U.S. Coal Plants Already Shut: 15,677 MW Total Capacity of U.S. Coal Plants Scheduled to be Shut: 34,306 MW
Join us for 5 Tips to Alleviate the Pains of Budget Planning and Management educational webinar on July 18th, where we will address how to:
Identify and understand market drivers Start 2014 outlook communications early
5 Tips to Alleviate the Pains of Budget Planning & Management July 18th
Big Data Energy Trends Educational Webinar July 25th
Q&A Session
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