Winter Storm Grayson -- The Grid -- Janaury 5, 2018

Updates

January 6, 2018: as a reader suspected -- dual-fuel units are switching to oil, burning through emissions limits.  A huge "thank you" to another reader for spotting this.

New Yorkers and New Englanders are cranking up their thermostats to stay warm amid an extreme cold snap, but New England's grid overseer and its generators are finding that dual fuel generators are burning through not only needed wintertime oil supplies but also emissions allowances for the rest of the year.

ISO New England spokesperson Marcia Blomberg said the regional power system is operating under normal conditions but the extreme cold weather is increasing demand for natural gas for heating, creating pipeline constraints, driving up natural gas prices and causing dual-fuel generators to switch fuels. As a consequence, oil- and coal-fired power plants are generating much more power than usual and wholesale power prices have soared, said Blomberg.

As of 10:30 a.m. on Jan. 2, 34% of New England's electricity was being supplied by oil-fired generation (which over a given year supplies less than 1% of the region's generation), followed by natural gas at 25%, nuclear at 23%, renewables at 9%, coal at 6% and hydro at 4%. Of the renewable generation, 62% of it was supplied by greenhouse gas-emitting wood-, refuse- and landfill gas-fired generation, with wind supplying 38% and solar less than 1%. According to data from SNL Energy, ISO-NE's internal hub clocked a day-ahead power price of $210/MWh at peak on Jan. 2, up from a Dec. 22 peak of just $66.25/MWh.

n neighboring New York, which also faces wintertime gas capacity constraints, grid overseer New York ISO said the state has sufficient generation capacity and reserves to meet Jan. 2's projected peak demand of 24,500 MW, with some dual fuel units switching to oil as a result of increased demand for natural gas and both higher gas and wholesale electricity prices. According to the NYISO, dual fuel resources supplied nearly 30% of the state's generation at 12:15 p.m. on Jan. 2, followed by nuclear at roughly 28%, hydro at almost 15% and natural gas at approximately 14%.

New York's Hudson Valley saw power prices skyrocket to $205.50/MWh for Jan. 2 day-ahead markets compared with just $35/MWh on Dec. 22, while New York City area day-ahead prices increased to $215.25/MWh compared with $35/MWh on Dec. 22, and Western New York day-ahead prices soared to $195/MWh from $29.75/MWh on Dec. 22. 

January 6, 2018: by the way, a reader clicked on "renewables" over at ISO New England to discover that renewables are:

• wind: 50%
• wood, garbage: 50%

It should also be noted that in many regions, hydroelectric power is lumped in with renewables. With wind making up only 50% of "renewables" as defined in New England, it explains why renewable energy has been able to maintain a certain consistent level. But it also "hides" how little wind is actually contributing to the overall grid, but creates havoc for those administering the grid to keep it from going down.


Later, 10:14 p.m. CT: there it is -- oil goes over the "40% threshold." Now at 41%. Note also that coal plant has a) gone off-line; or, switched to oil. Also note that natural gas contribution is plunging. And considering that wind energy is "free" or so they say, it is surprising that they are using so much oil. Why not just increase wind energy contribution?

Original Post

The road to New England. Earlier we saw one of three nuclear plants "go down."

Now, a reader notes that it appears a coal-fired plant has either a) gone down; or, b) switched over to oil.

Also, of note, I have not yet seen the percentage of oil contributing to electricity generation going over 40% but here it is at 39%. It's possible oil has gone over 40% and I missed it; regardless, that's a threshold to watch.

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Winter Storm Grayson

National natural as withdrawal. Noteworthy this past week, but next report will be quite incredible -- check back in one week:

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Winter Chill Is The New Global Warming -- Algore

-100 Degress -- Wind Chill -- Mount Washington, New Hampshire -- January 5, 2018

Updates

January 6, 2018: spot price is about $330 right now, early morning, in New England.

Later, 7:50 p.m. CT: see first comment, how much this is going to cost the average consumer in New England. And that cost is wholesale.

Original Post

 
From Travel And Leisure:

If you think it's cold where you live today, just be glad you're not at the summit of Mount Washington.

Temperatures atop the New Hampshire mountain, which is known for its bitterly cold temperatures and fierce winds, were forecast to sink below -20 degrees Friday, dropping to somewhere between -70 and -80 degrees after accounting for windchill. Overnight, air temperature is set to hit -40 degrees, with 100-miles-per-hour winds causing windchill to hit -100 degrees.

But despite the punishing temperatures, at least three hearty weather observers will be stationed at the Mount Washington Observatory, recording information about air temperature, wind speed, visibility and cloud cover at the summit every hour — manually, since extreme cold destroys most automatic equipment. 

From Agore: cold is the new warming.  And they say Trump is demented. LOL.

One of my older cars has been to the top of Mount Washington. I was not in it at the time. Our older daughter and her family took it to the top. She has the bumper sticker (actually a magnetic auto sticker).

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Climate-Change Policies Can Be Punishing For The Poor

Just Ask New Englanders Next Week

From The WSJ: climate-change policies can be punishing for the poor. 

Freezing temperatures in the U.S. Northeast have pushed up heating costs, creating serious stress for many Americans. Although the rich world’s energy poor are largely forgotten in discussions about climate policies, they bear an unfair burden for well-meaning proposals. That reality is being laid bare this icy winter as energy and electricity prices surge.

When we think about energy poverty, we imagine a lack of light in the world’s worst-off nations, where more than one billion people still lack electricity. This is a huge challenge that the world can hope to address as it reduces poverty and expands access to grid electricity, largely powered by fossil fuels.

But there is a less visible form of energy poverty that affects even the world’s richest country. Economists consider households energy poor if they spend 10% of their income to cover energy costs. A recent report from the International Energy Agency shows that more than 30 million Americans live in households that are energy poor—a number that is significantly increased by climate policies that require Americans to consume expensive green energy from subsidized solar panels and wind turbines.

This is a great, great op-ed, but the author is almost worthy of being named a nominee for the Geico Rock Award for 2018.

Rigs Hold Steady At 54; Six New Permits; Six Permits Renewed -- January 5, 2018

Active rigs:

$61.59↓	1/5/2018	01/05/2017	01/05/2016	01/05/2015	01/05/2014
Active Rigs	54	39	58	170	184

Six new permits:

• Operators: Hess (5); XTO
• Fields: Capa (Williams); Pembroke (McKenzie)
• Comments: Hess has permits for a 5-well Burdick pad in SESE 20-155-95

Six permits renewed:

• QEP (2): two Moberg permits in McKenzie County
• Petro Harvester (2): two Ligi permits in Burke County
• Enduro Operating: one NSCU perit in Bottineau County
• BR: one Ole permits in McKenzie County

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The graphic (see Hess Burdick permits above):

Updates From The Williston Wire -- January 5, 2018

But first this: best news all week! Every Thursday I take our oldest granddaughter up to Lewisville (TX) for water polo practice. I watch for awhile and then head over to the McDonald's across the street to do a bit of blogging. For the past three years, the television in this particular McDonald's has been tuned to CNN. Last night ... drum roll ... it was tuned to Fox. I caught up with the manager, whom I know quite well by now, and thanked him for "changing the network." He smiled, apparently appreciated the feedback. I hope this was not a one-time change. 

From the Williston Wire:

Watford City automobile dealership.

At one time in the early 2000s, Watford City was the home to three new car dealerships. But changes in the requirements for dealers to maintain their new car franchises made it more and more difficult for small town owners to make the investments. But with the city's population growing to more than 7,500 in the past four years, one of the biggest questions area residents as well as economic development groups were asking was, "when will a new car dealership open again in Watford City?" That question was finally answered when the owners of Red Rock Ford in Williston, Dickinson and Fergus Falls, Minn., announced plans to open a new dealership in Watford City.

New Town police department:

The New Town Police Department is close to moving into its new, permanent home. Chief Tyler Rintamaki updated the New Town City Council on the progress of remodeling the interior of the New Town City Hall to make it suitable to house the department. The final installation of new locks and other details are all that remain before Rintamaki and his five officers relocate. When the City of New Town reestablished the police department in 2012, it was housed in an older manufactured building east of the Civic Center. That building deteriorated over the next few winters and the force relocated to the old Vocational Education building.

Patrick Kennedy: Our Grandchildren Will Never See Snow Again -- Never Mind -- January 5, 2018; It Was Never This Cold When Obama Was President

With all this hysteria about Winter Storm Grayson, is it just me or do others also realize, "hey, this is winter. It happens fairly regularly."?

And to think Patrick Kennedy, of the famous Kennedy clan, was worried that "our" grandchildren would never see snow again.

It's hard to believe but as recently as January 27, 2016, Colin Barras, for the BBC, was asking, "will snow become a thing of the past as the climate warms?"  He was writing that even as

New York and Washington, DC have just been smothered by another massive snowstorm, which seems strange when you remember that the world is getting hotter.

From a post a couple of years ago:

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Global Warming 2014 - 2015

The unnamed 2014 autumn polar vortex: the headlines started appearing November 11, 2014:

• Minnesota shatters snow record from 1898 -- predicted by warmists -- global warming will result in more snow 
• Arctic blasts pummels USA -- unexplained; stuff happens 
• Only six (6) states not expecting snow in coming week (and one of them may be Hawaii) 
• Winter still a month away 
• Twelve (12) years since Dallas has had two consecutive days so cold  
• Wyoming wind chill warning: 35 below  
• Central Ontario snowfall could reach 20 inches  
• Cold to freeze East  
• Shattering snowfall records in Minnesota, Wisconsin, Michigan -- predicted by warmists -- global warming will result in more snow 
• All 50 states brace for freezing temperatures -- November 13, 2014 
• Cold freeze moves east -- November 13, 2014 
• Denver cold shatters two records, including low temp record set in 1882 -- November 13, 2014 
• Coldest November in decades -- November 14, 2014 
• Michigan town receives one month's snow -- in one day --November 14, 2014 
• Storm dumps four (4) feet of snow on Wisconsin town -- November 14, 2014 
• Ice on Lake Superior -- almost a month early -- November 16, 2014 
• Harsh cold to set records in south, freeze northeast -- November 16, 2014
• Snow on the ground in DFW area; 27 degrees -- November 17, 2014 
• 50% of nation covered in snow -- November 17, 2014 (this was on ABC Nightly News, also)
• Most snow this early in a decade -- November 17, 2014
• Four (4) feet of snow expected in upstate New York -- November 17, 2014
• Record cold in Boise, Idaha, Monday morning, possibly again Tuesday -- November 17, 2014
• Deep freeze blankets USA -- November 18, 2014
• Coldest November morning since 1976 -- November 18, 2014
• 1,360 records shattered in one week -- November 18, 2014
• "Global warming" activists huddle together together in Capitol -- November 18, 2014
• I-90 closed in Buffalo, NY; snow -- November 18, 2014
• Buffalo, upper NY state gets slammed -- November 18, 2014
• 74 inches of snow predicted overnight in Buffalo, NY -- November 18, 2014 
• Cuoma deploys organized militia (National Guard) -- November 18, 2014

ONEOK Announces New NGL Pipeline; Montana To Kansas; $1.4 Billion -- Keeping America Great -- January 5, 2018

Updates

January 8, 2018: the ONEOK story is also at the Bismarck Tribune. At $1/bbl, 240,000 bbls/day, $1.2 billion, a reader notes that it will take more than 13 years to simply pay off the $1.2 billion. This suggests to me that ONEOK thinks

• fossil fuel will be around for a long, long time; and,
• the Bakken and DJ will be a huge source for NG for a long, long time.

Long, Long Time, Linda Ronstadt


January 8, 2018: another reader weighs in on this announcement, see comments:

Ethane right now is left with the methane stream except at Tioga Hess Plant, where the Vantage pipeline to Alberta takes it too a cracker. That line has a 68,000 barrels per day.

The new lines won't be able to accommodate ethane, so ethane cracking could be another industry courtesy of the Bakken.

Ethane doesn't have the value for long distances so it needs to be consumed locally.

January 6, 2018: see comments -

OneOK built a 12" NGL line from MT to SE Wyoming about 5 years ago.

If you look at a map of the new line it looks like it is parallel with the original. I wonder if it is in the same right of way?

The original line was designed to carry 60,000 BBL per day, then it was boosted to 110,000 barrels and then 165,000 BBL. You can see mention at this link http://bismarcktribune.com/bakken/oneok-investing-in-several-projects/article_b8147fa6-516d-11e3-8f2d-0019bb2963f4.html.

Pipeline builders would probably like to keep their intentions as quiet as possible until the line is built. As I recall the original line ran into some opposition in the area of the Bear Lodge Mountains around Devils Tower due to the line passing through an area with gyp rock.

With this much increased capacity to transport NGL out of the WB the future looks bright for future production growth it appears to me. New or expanded gas plants in the works also? Or maybe updated Central Tank Battery production facilities with pad drilling being the new source of NGL?

I've seen a few CTB sites the last couple times I was in Dunn County and they contain several what appears to be ASME code vessels with many pipes connected to each vessel. Do these mini processing plants strip volatile/liquids from the oil and the gas? Which end up in NGL pipelines? (http://www.oneok.com/~/media/ONEOK/Newsroom/ReleaseDocs/ElkCreekPipeline_Map.ashx) link to the map of the new line. [By the way, to open an "ashx document" use Adobe.]

Later, 1:27 p.m. CT:  see first comment --

Sending unfractionated NGLs - aka 'Y grade' out of the Bakken could have a significant positive impact on operators' financials.

Essentially, removing the methane from the gas stream (possibly 70% +/- of the total volume) enables the higher value liquids to be transported and processed via pipeline.
I think liquids are presently transported by rail.

Today's spot pricing at Belvieu, expressed in barrels ...

• Ethane ~$11/bbl.
• Propane ~ $40/bbl
• Butane ~ $42/bbl
• Pentanes ~ $58/bbl

Transportation and processing fees would come out of these figures, but, still, it adds up in addition to the methane price realized at the Northern Border transfer point.

Original Post

Every now and then a developer announces a small wind farm and the local media is all over it, talking about the "new" wind farm. At the other end of the continuum the oil and gas sector seems to announce a new billion-dollar project every week. And there's no fanfare. If it weren't for the company's press release, we would probably never hear about it.

If a Martian were to read all the energy stories in the mainstream media, the alien would get the feeling that fossil fuel industry is dead, replaced by wind and solar. Hardly.

Another example, sent by a reader: ONEOK Announces Plans to Increase Natural Gas Liquids Takeaway Capacity out of the Rocky Mountain Region, press release. Details:

• the Elk Creek pipeline
• from ONEOK's Riverview terminal in eastern Montana to Bushton, KS
• 900 miles, 20-inch diameter
• to be completed by end of next year (2019)
• capacity: 240,000 bbls/day of unfractionated NGLs
• the pipeline: $1.2 billion
• related infrastructure costs: $200 million
• with additional pump facilities, capacity will increase to 400,000 bpd

TransCanada pipeline operational. Data points:

• Leach XPress
• 160 mile; 1.5 billion cubic feet/day
• will supply gas to Southeast and Gulf Coast markets
• had received approval from FERC on January 9, 2017

The Market And Energy Page, T+349 -- January 5, 2018

Updates

January 25, 2018: many, many stories on trucker shortage on the blog; here's an update from Arizona (trucks, trucking, truckers)

Later, 12:49 p.m. CT: wow, shares in Barnes & Noble plunge more than 14%. The company must have missed the holiday memo.

Later, 12:46 p.m. CT: headline/story over at Yahoo!Finance -- APPL shares are up today after news report that Apple chips have major flaws. I can't make this stuff up.

Later, 10:50 a.m. CT look at first comment regarding ELD (electronic logging device). At the very same time I received that anonymous comment, I also received an e-mail from another reader:

I sent the url to this WSJ article to a truck driver who drove semi cross country years ago, and has been a load dispatcher for maybe 25 years. Here were his comments:

The article and it's pretty much spot on. ELD’s are playing a bigger roll than anticipated, I think. 

Old timers are saying piss on it, "I’m not doing that." 

The economy seems to be rolling and we lost trucks instead of gaining trucks. I have been saying this for years. 

We have trained out children to run a computer, not to work with their hands in a trade and I consider being a truck driver a trade. Anytime you sit in a seat of a commercial vehicle you have every branch of the law enforcement trying to find something wrong with you or the truck and dig into your pocket book.

Original Post

Market: it looks like we may have four consecutive days of new records among the equity markets. Dow futures up 72 points; other major indices also up.

African-American unemployment at record lows; lowest since BLS began keeping records in 1972. It begs the question: what was President Obama doing for eight years?

Trucking: The WSJ is reporting -- Tight Trucking Market Has Retailers, Manufacturers Paying Steep Prices, Some companies are delaying nonessential shipments rather than scramble to find a truck.

Retailers and manufacturers grappling with an unusually tight trucking market are paying the steepest prices in years to keep their goods moving.

Freight demand had been ticking up for months, closely tracking the strengthening U.S. economy. The market got a boost from retailers needing to restock store shelves and distribution centers amid the biggest jump in holiday sales since 2011. That wave of demand hit the trucking market just as a new federal safety rule kicked in, leading some drivers to idle their big rigs.

By the end of last week, just one truck was available for every 12 loads needing to be shipped, according to online freight marketplace DAT Solutions LLC. That is the most unbalanced market since October 2005, after Hurricane Katrina, and is up from a roughly 4-to-1 ratio at the end of 2016.

Saudi Aramco IPO, link here: 

There had been some speculation that the IPO could be shelved, as the Saudi government's self-imposed end-2017 deadline for picking an international stock exchange lapsed without so much as a murmur about its location. The Saudi government changed the status of Aramco to a joint stock company, in a signal that the float of the company will go ahead.

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Back To The Bakken 

Active rigs:

$61.61↓	1/5/2018	01/05/2017	01/05/2016	01/05/2015	01/05/2014
Active Rigs	54	39	58	170	184

 
RBN Energy: streamlining water delivery and produced water takeaway in the Permian.

The Bakken -- A "Mini-Boom"? -- January 5, 2018; Williston, Tioga Takes Lead In Increase In Taxable Sales

Updates

January 8, 2018: do you remember this post. Flashback, August 23, 2017. 
 

Original Post 

From the North Dakota tax commissioner:

Tax Commissioner Ryan Rauschenberger announced Thursday, Jan. 4, that North Dakota's taxable sales and purchases for the third quarter of 2017 had a slight increase. 

Taxable sales and purchases for July, August and September of 2017 were nearly $4.731 billion, a 2.3 percent increase over those months in 2016.

"Although the retail trade sector was down during the third quarter, we see a large increase in some of the industries related to oil activity," Rauschenberger said. "If energy prices continue to rise, we could feel the impact in other areas as well."

Rauschenberger went on to explain that as energy production continues to accelerate in North Dakota, most of the other industry sectors see a coinciding boost. 

Of the 50 largest cities in North Dakota, the highest percent increases for the third quarter of 2017 (compared to the third quarter of 2016) were as follows:

• Tioga - Increase of 31.51 percent
• Williston - Increase of 29.55 percent
• New Town - Increase of 27.25 percent
• Casselton - Increase of 24.53 percent (near Fargo)
• Langdon - Increase of 23.91 percent

Counties with the highest percent increases for the third quarter of 2017 (compared to the third quarter of 2016) were as follows:

• Dunn County – Increase of 47.1 percent 
• Burke County – Increase of 29.46 percent 
• Williams County – Increase of 29.15 percent 
• LaMoure County – Increase of 28.34 percent 
• Renville County – Increase of 25.89 percent 

Note which city, which county not on the top five list: Watford City, McKenzie County.

Also, noteworthy: Minot, Ward County not on the short list. Nor Dickinson, Stark County.

A Very Good Jobs Report -- CNBC - January 5, 2018 -- African-American Unemployment At All-Time Low

Small increase in number of jobs; less than forecast.

Unemployment rate remains unchanged, 4.1%.

Anti-Trumpers will have fun with this. But CNBC talking heads said this is actually a great number.

Job losses in retail sector -- down 67,000 for the year. [Warehouse workers -- such as Amazon -- are not reported in the retail sector.]

62.7% participation in labor force.

U6 - 8.1% -- this was "never" reported under the previous administration. Now, under Trump it's being reported. Steve Liesman made a huge, huge deal about this. During this discussion, Becky Quick showed her ignorance on the "Fed."

6.8% -- African-American unemployment rate -- lowest since BLS started keeping records in 1972.

US government cut 16,000 jobs in 2017.

US gained almost 200,000 manufacturing jobs in 2017.


This is how Yahoo!Finance saw it:

This is how investors saw it: Dow up 100 points.


Food stamp recipients down two million under Trump. 

Winter Storm Grayson: Where's The Natural Gas? What Happened To Hydroelectricity -- January 5, 2018

A graphic from yesterday:

The graphic from early this morning:

This is what jumps off the chart:

• spot price surges to almost $500/MWh
• what happened to natural gas? normally natural gas use surges when demand spikes
• one nuclear plant remains off-line
• what happened to hydro? hydro spiked to "2k" in the chart yesterday when electricity demand surges; today; hydro drops completely to zero before recovering a big
• coal remains maxed out
• later, 9:26 a.m. -- not seen on the this graphic -- renewables falling off just as demand increases