RE:RE:RE:RE:RE:New 52 Week Low ---$1.44Good response Jerrybe
Some background I can add to gas demand going forward.
Ontario was the first electricity control area to begin the switch to gas in a big way in order to shut down the coal fired plants. People thought we were nuts. But today natural gas is the go to energy source as coal fired generation is rapidly being retired right across North America and older Nuclear plants which can no longer have their licenses extended are being de-commissioned. Natural gas is replacing much of this capacity. It is creating problems that never existed before in the industry. Before I touch on what it means to winter operation consider summer demands. Wind generation is becoming another major energy resource but it has such a low capacity factor especially in the summer (there is no wind on the hottest days of the summer) that gas fired generation is often severely stretched to meet the demand.
The winter is however the scariest time of the year for the power industry. Below are a few statements made in the most recently published long term NERC adequacy report for the North American electricity bulk power grid. My understanding is that PJM was very close last year to declaring an emergency state due to gas availablity shortfall to power generation facilities (PJM is a big chunk of the Eastern US interconnection involving multiple States). If that happens this winter (with more coal fired generation retired and not available to bring on line) it will spike the price of gas even though it really has little to do with supply but transmission/pipeline capacity. That being said the NA power industry will continue to ramp its use of natural gas and at some point supply and demand will become unbalanced without a clear solution for replacement energy.
https://www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/2014LTRA_ERATTA.pdf
3. A Changing Resource Mix Requires New Approaches for Assessing Reliability
North America’s resource mix is undergoing a significant transformation at an accelerated pace with ongoing retirements of fossil-fired and nuclear capacity and growth in natural gas, wind, and solar resources. This shift is caused by several drivers,
primarily existing and proposed federal, state, and provincial environmental regulations. Other drivers include lower natural
gas prices due to abundant supply, along with policies incentivizing the movement from conventional energy resources
toward ongoing integration of both distributed and utility-scale renewable resources. The convergence of these resource mix
changes is directly impacting the behavior of the North American BPS. These developments will have important implications
on industry planning and operations, as well as how NERC assesses reliability.
2014 Polar Vortex
NERC Scenario: Considerations for Long-Term Planning
The 2014 polar vortex, impacting a majority of the midwestern
and northeastern United States and southern Canada, tested
the resilience of the North American BPS. This event served as
an example of how extended periods of cold temperatures have
direct impacts on fuel availability, especially for natural-gasfired
capacity. Higher-than-expected forced outages were
observed during the polar vortex, particularly for natural-gasfired
generators, as well as higher-than-forecast peak demand.
The following impacts were caused by fuel delivery challenges
and extended periods of low temperatures:
Fuel Delivery
Natural gas interruptions: supply injection, compressor
outages, and one pipeline explosion
Oil delivery problems
Inability to procure gas
Fuel oil gelling
Low Temperatures
Low temperature limits for wind turbines
Icing on hydro units
Failed auxiliary equipment
Stress of extended run times
Frozen instrumentation (drum level sensors, control
valves, and flow and pressure sensors
To examine the potential impacts of a similar event in the
future, NERC ran scenarios on select Assessment Areas (SERC-E,
PJM, MISO, and TRE-ERCOT) that experienced significant loss of
generation during the 2014 polar vortex event. Actual forced
outage data were applied as derates to existing and projected
(Tier 1) capacity projections using the 2014LTRA reference case.
Load was assumed to be consistent with the extreme loads that
were observed.
Based on this NERC scenario, projected reserve margins
combined with the projected increased dependence on natural
gas will increase the adverse impacts to BPS reliability if similar
extreme weather events occur in the future.
The complete scenario is included as Appendix III.
What Does the 2014 Polar Vortex Tell Us about the Future?
As more generating capacity is natural gas fired, additional
assessment of Firm pipeline transportation is needed to
ensure sufficient gas is available during both normal
operation and periods of high stress, as exemplified by the
polar vortex event.62
Overdependence on a single fuel type increases the risk of
common-mode disruptions as experienced during recent
extreme weather events. Disruptions in natural gas
transportation to power generators have prompted the gas
and electric industries to further examine reliability
implications associated with increasing natural-gas-fired
generation.
As highlighted in this assessment, most new capacity
additions are natural gas fired. Over the past two years, both
industries have made significant progress to better link the
operations of these vastly different industries.
The gas and electric industries operate under different
regulatory structures and rules that affect how infrastructure
is planned, built, maintained, and ultimately operated. As the
dependence on natural-gas-fired generation increases in
North America, the natural gas and electricity industries
continue coordination efforts. The relationship between
natural-gas-fired generation availability and low
temperatures further challenges the industry’s ability to
manage extreme weather conditions, particularly when
conditions affect a wide area and there is less support
available from within an interconnection. These extreme
weather events should serve as early indicators of more
frequent impacts if natural gas supply and transportation is
outstripped by the demand from new natural-gas-fired units
continue to rely on interruptible gas.As more generating capacity is natural gas fired, additional
assessment of Firm pipeline transportation is needed to
ensure sufficient gas is available during both normal
operation and periods of high stress, as exemplified by the
polar vortex event.62
Overdependence on a single fuel type increases the risk of
common-mode disruptions as experienced during recent
extreme weather events. Disruptions in natural gas
transportation to power generators have prompted the gas
and electric industries to further examine reliability
implications associated with increasing natural-gas-fired
generation.
As highlighted in this assessment, most new capacity
additions are natural gas fired. Over the past two years, both
industries have made significant progress to better link the
operations of these vastly different industries.
The gas and electric industries operate under different
regulatory structures and rules that affect how infrastructure
is planned, built, maintained, and ultimately operated. As the
dependence on natural-gas-fired generation increases in
North America, the natural gas and electricity industries
continue coordination efforts. The relationship between
natural-gas-fired generation availability and low
temperatures further challenges the industry’s ability to
manage extreme weather conditions, particularly when
conditions affect a wide area and there is less support
available from within an interconnection. These extreme
weather events should serve as early indicators of more
frequent impacts if natural gas supply and transportation is
outstripped by the demand from new natural-gas-fired units
continue to rely on interruptible gas.