Market Outlook
The best energy solutions emerge from many factors. A prime example is the energy market itself — something our team is well-versed in considering on your behalf. Here's an overview.
Natural Gas
NYMEX Natural Gas Pricing
The July 2023 contract settled at $2.603/MMBtu.
The August 2023 contract was trading around $2.62/MMBtu (as of publish date).
Natural Gas Storage
Current BCF in Storage (2023 vs 2022):
| Week Ending | Total BCF | Week Ending | Total BCF |
| 9-Jun-23 | 2,634 | 10-Jun-22 | 2,095 |
| 16-Jun-23 | 2,729 | 17-Jun-22 | 2,169 |
| 23-Jun-23 | 2,805 | 24-Jun-22 | 2,251 |
| 30-Jun-23 | 2,877 | 1-Jul-22 | 2,311 |
There is about 25% more in underground storage now than there was at this same time last year.
Source: EIA
Weather
6-10 Day
8-14 Day
Source:NOAA/ National Weather Service
Market News
The largest coal-fired power plant in Pennsylvania will close by July 2023
https://www.eia.gov/todayinenergy/detail.php?id=56700The Homer City Generating Station in Pennsylvania will close by July 2023 after 54 years of providing power to Pennsylvania and New York. The plant is currently seeking approval from PJM to retire. The 1,888 MW coal plant began generating electricity in 1969. This is one of many coal plants across the country that are retiring. U.S. coal-fired capacity has declined from 313 GW in 2005 to around 196 GW today.
LNG-exporting Gulf Coast states drove U.S. natural gas demand growth
https://www.eia.gov/todayinenergy/detail.php?id=56940Total U.S. natural gas demand increased 43% from 2012 to 2022. Demand in Louisiana and Texas grew by 116% because of increasing demand for feedgas for LNG exports. Electric power generation was the second-most significant factor in natural gas demand growth because of coal-to-gas switching and rising demand for air conditioning. Total natural gas demand in the Midwest grew by 35% between 2012 and 2022 because natural gas consumption in the electric power sector more than doubled during this period. In the Northeast, natural gas demand grew by 36% between 2012 and 2022, also driven by increased consumption in the electric power sector.
FERC Order Delays Capacity Auction To Allow for Consideration of Resource Adequacy Reform
https://insidelines.pjm.com/ferc-order-delays-capacity-auction-to-allow-for-consideration-of-resource-adequacy-reform/PJM has been given the green light to revise their auction schedule for delivery years 2025/26-2028/29. The auction that was supposed to occur mid-June will now occur one year later in 2024. Subsequent auctions will be held every six months after that through May 2026. PJM and stakeholders are currently working through market reforms to ensure reliability; anticipated enhancements are expected to be filed by October 2023.
June 2023 update on regional transmission investment now available; 24 projects under construction in New England
https://isonewswire.com/2023/06/27/june-2023-update-on-regional-transmission-investment-now-available-24-projects-under-construction-in-new-england/There are 35 active transmission reliability projects in New England, 24 of which are currently under construction. Most of the active projects are in Massachusetts and Maine, 16 and 8 respectively. There are six active projects in Connecticut, four in New Hampshire and one in Rhode Island. Since 2002, the ISO has facilitated roughly $12 billion in transmission investments. With these current and future projects, the ISO expects to invest an additional $1.5 billion though 2027.
NOAA declares the arrival of El Niño
https://www.weather.gov/news/230706-ElNinoAs expected, El Niño has finally emerged. Scientists had issued the first watch in mid-April. The conditions are expected to strengthen gradually into the winter.
El Niño is a natural climate phenomenon that occurs when sea surface temperatures in the central and eastern Pacific Ocean near the equator are warmer-than-average. This can happen every 2-7 years on average. Typically, during the fall and winter, this event results in wetter-than-average conditions in the southern US and drier- and warmer-than-average conditions in the North.
IN ADDITION: Two interesting articles from PJM & ISO-NE describing the impacts to solar and demand from the Canadian wildfires.
- Canadian wildfires impacting solar production, electricity demand in New England
- Quebec Wildfire Smoke Reduced Solar Output, Electricity Demand in PJM Region
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