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Poll Results: Ohio Voters Against Re-regulation to Monopoly Utilities

At this point it is old news, that the largest electric utilities in Ohio have been in discussions regarding “restructuring” competitive markets within the state. Despite their efforts to change the current seven-year construct, Ohio voters may be the biggest political snag in their way.
Based on a poll conducted in January and by Fallon Research and Communications, and first reported by The Cleveland Plain Dealer, Ohio voters are very much in opposition of a return to a regulated market construct that would allow monopoly utilities. The telephone survey was conducted in January polled a panel of 800 Ohio voters about key supporting issues. The results favoring energy choice and objection to monopoly utilities were consistent across party affiliation, gender, age, and location.

Results from Fallon Research’s Poll & The Plain Dealer’s Report:
More than 91 percent would oppose any law change allowing FirstEnergy or Columbus-based AEP to build new power plants and raise monthly rates to pay for them. AEP wants to do exactly that, build wind and solar farms and maybe new gas turbine plants while selling off or closing its old coal units.
Nearly 79 percent would oppose any legislation that did away with a customer’s choice to shop for power suppliers. Dozens of independent suppliers now compete for customers through a state-maintained “Energy Choice” website. A return to old-style regulation could end that kind of competition, say independent power companies, forcing customers to return to their traditional electric utilities for electricity as well as delivery.
Nearly 62 percent said they would oppose paying extra every month to support older power plants that cannot compete well against modern gas turbine plants. FirstEnergy has persuaded state regulators to do just that — though the latest subsidy does not mention its power plants. Federal regulators objected to earlier, more expensive proposals that spelled out exactly how the extra fees — amounting to an extra monthly consumer bill every year — would be spent.
Nearly 60 percent of voters would object to the creation of special subsidies for one fuel source — in this case FirstEnergy’s nuclear power plants, which are expensive to operate and do not always compete well against gas turbine plants. The idea has been adopted in New York and Illinois, but has been challenged as anti-competitive. FirstEnergy is considering asking for such a subsidy but has not made a final decision.
AARP and the Alliance for Energy Choice, a group representing independent power producers funded the statewide poll. The Alliance spokesperson, and former chairman of the PUCO, Todd Snitchler spoke on the results of the poll commenting that, “The results of the poll clearly demonstrate that talk about a need for re-regulation or changes to Ohio’s energy landscape, is pointed in the wrong direction.

Fallon Research and Communications. (2017). Ohio Voters on Energy Choice 2017. The Cleveland Plain Dealer [Distributor]. Retrieved from http://www.cleveland.com/business/index.ssf/2017/02/ohio_voters_want_energy_choice.html.

 

Nexus Pipeline Development Facing “Batty” Road Blocks

The Nexus pipeline project has run into countless hurdles and road blocks ever since its initial proposal last year. We first reported on the Nexus project back in March of 2016. The intent of the project is to support the growing demand for clean-burning natural gas, by building additional pipeline infrastructure in Ohio, Michigan, and Ontario (Canada). Following completion, the pipeline system is expected to move 1.5 Bcf/d (billion cubic feet a per day) of natural gas from southeastern Ohio, eventually ending in southern Ontario.

As of last March, 13 connection agreements were made with various Ohio markets affected by the proposed route. Since then, the project has faced turbulence from activist groups and countless townships. Just in the last couple of weeks, objection efforts have made news on several occasions. Just a few of these examples are below:

• The city of Green, Ohio has hired law firm, Frost Brown Todd to aid in the city’s fight to reroute the pipeline away from the city. City officials believe the pipeline will have a $120 million impact on the city.
• Bowling Green city Council voted months ago to deny an easement offer to build part of the pipeline through the city, and now has protesters on the proposed ground attempting to further stall its construction. UC4POWER a local activist group and BGSU faculty believe the pipeline could contaminate local water supply.
• One of the most peculiar reports comes from Medina County, where “the coalition to reroute Nexus” cites bats as an argument against pipeline construction. This part of the state is home to northern long-eared bats, a threatened species. As a threatened species, their habitat is supposed to be protected during the bats’ nesting season, but the coalition is fearful that Nexus could be granted an exception.

In attempt to avoid more conflict, Nexus pipeline partners asked FERC (Federal Energy Regulatory Commission) to expedite the decision to grant permission by February 3rd, to build the pipeline, before one of the FERC commissioners steps down. FERC was inactive in response. The Nexus project isn’t dead yet, but at the moment, the future does appear uncertain.

 

Did Christmas come early for the coal industry?

Robert Murray, CEO of Murray Energy Corporation, the largest underground coal mining company in the US based in St. Clairsville (OH) has been one of the most outspoken people in the “war on coal”. Although pleased with the outcome of the election, his excitement is tempered by an underlying reality of how quickly things have changed in the power generation sector.
Mr. Murray would probably like Santa to deliver everyone a lump of coal in their stockings (as a good thing) this year, but is also keenly aware that natural gas and renewables (wind/solar) are taking a larger and larger piece of the generation pie. In fact, in 2007 coal represented 48.5% of the main fuel source for generation, today (through June 2016) it is sitting just under 30%.
Interesting that he doesn’t see the jobs coming back but is also concerned as more LNG and exports are on the horizon, that in turn will drive up natural gas pricing and coal will still be in demand as the main baseload, low cost fuel source for some time to come.

 

For more details:

http://www.powermag.com/coal-magnate-tells-trump-to-lower-his-expectations/?printmode=1

 

 

Stretching Black Friday Savings Beyond the Sale

Holiday shopping is around the corner and we are now just days away from the biggest retail spending day of the year. For many, getting up at the break of dawn and joining the pandemonium of people traffic and chaos to save a few bucks has become almost a yearly ritual.

If you are in the market for a new television or electronics, black Friday deals don’t have to stop at the checkout line. By purchasing energy efficient devices and adjusting the settings of your new electronics after you unbox them, you can yield savings year-round on your energy bills. The following suggestions might be worth considering for you early bird bargain hunters.
When available, purchase ENERGY STAR ™ products. These products are the most efficient products in their product categories, and are generally the top 25% in energy efficiency. TV’s are a flagship black Friday item. While price discounts can be eye drawing, also pay attention to the yellow EnergyGuide label. Some of the higher end ultra HD televisions can consume as much as two to three times more than more efficient models. If you are looking to purchase a new video game console, be aware these devices can be big energy users. Nintendo Wii and Wii U’s use far less power than Playstations and Xbox’s. Playstations curtail power when in standby mode, but Xbox One’s continue to draw 10 watts of power even with the television off. If you are in the market for a device to stream media from the internet, media players such as Apple TV, Roku, or Amazon Fire are about 20-30 times more efficient than using a game console.

You can continue to save some green by making changes to device settings when you initially set them up. With new computers, use power-management settings to reduce energy use. Also skip screensavers and set the screen to switch off after 15 minutes of inactivity and to sleep after 30 minutes. Most new TV’s have a quick start feature than can be disabled. When the feature is enabled, the device can use excessive electricity in standby mode when the TV thinks it’s off. You can also turn on automatic brightness control on most new televisions. The feature can result in almost 50% of energy savings in a room that’s dimly lit.

What a better gift to give someone than one that keeps on giving. Device level meters such as the Kill-A-Watt EZ meter cost about $20-30, and assess the efficiency of the appliance or device it is plugged into, while helping you monitor and reduce your power costs over time. Programable and Smart thermostats allow you to set schedules and conditions for your home HVAC system which can easily save you up to 30% annually on your utility bills. LED bulbs may not get your gift recipient grinning from ear to ear, but every LED bulb you replace can save around $100 over its lifetime versus incandescent.

Choosing more energy efficient electronics help curb climate pollution, so not only are you saving green, you’re being green as well. These products may not laugh when you tickle them, but the long-term savings might allow to increase your gift budget for next Christmas. So when you’re strolling through your favorite box store, groggy from yesterday’s turkey, it might be worth keeping some of these suggestions in mind.

 

Powerhouse: The University of Houston

The University of Houston is having an impressive football season, but the Cougars are unmatched every year in the energy sector.

From event sponsorships and stadium naming rights to league wide corporate partnerships, energy and utility companies are no strangers to marketing through sports. One state where both energy and sports are considered dominant politically and economically is the great state of Texas. The cliché of “Everything is bigger in Texas” definitely holds true to both. Texas leads the country in natural gas, oil and net electricity production. If Texas were considered its own country, it would rank sixth globally in oil production and eleventh in electricity production.

texas-fbs-programsTexas also leads the way in number of college football programs with 52 total NCAA sanctioned programs and 10 FBS: Division 1-A schools. When you think of Texas college football, the conference that comes to mind is the Big-12, and if there were a Big-12 conference of energy, the University of Houston would not only top the conference, but would be leading the FBS rankings.

Considered “Energy Town, USA,” Houston is home to 17 energy related Fortune 500 companies and more than 3,600 energy-related firms. For years the university has drawn from the influence of the industry around it to establish itself as the premier energy institution. UH is only rivalled in the field to the likes of outstanding engineering schools such as MIT. UH has always been well known for producing top engineering graduates ready for the fields of oil and natural gas, but now university research is also leading the way in the exploration of cleaner production and energy efficiency. The University of Houston’s energy research is responsible for many breakthroughs including discovering cleaner and more efficient ways for extracting oil and gas from the Earth, increased efficiency of drawing power from the sun and wind, and developing nanotechnology that can boost oil and gas recovery from existing wells with fewer chemicals.

uh-conferenceEnergy extends beyond the 50 energy-related degree programs at UH. The institution’s business school also focuses on energy finance and energy management, and offers an energy-focused MBA. UH has continued to stay in the forefront of the evolving energy sector by hosting an annual energy symposium series, which has become a renowned event amongst the energy industry. While the UH football team has had a notable season so far, the school’s energy program has been a “powerhouse” for years, and thanks to outstanding student research, it looks as though it will remain a dynasty for decades to come.

 

Smart Homes, Energy Efficiency Coming to a Palm Near You

While remote and voice controlled houses may seem more like science fiction than fact to most of us, home automation technology may soon be as common as smart TVs. Smart home technology has been available for several years now, but has been seen as more of a niche product category due to how complicated and expensive the systems are. The philosophy of smart home and home automation is transforming as the complex and pricey, custom-systems are being edged out by less expensive and simpler solutions.

It can get very costly to install a traditional home automation system. These custom systems require engineering and the help of an integration contractor. After purchasing interface equipment (remotes, keypads, etc.), and custom written software, you can easily be looking at a bill setting you back tens of thousands of dollars.

homekitThere is a revolution occurring in the smart home industry. Instead of needing engineered installation and custom programming, going forward systems will be integrated through smart phone/tablet apps and use standard connection interfaces such as Bluetooth and Wi-Fi, Apple, Google, and Microsoft have all invested billions of dollars in research and devolvement of “smart home” innovations, and all either have released platforms or are releasing one soon. These companies are experts in mass marketing and user friendliness, and are expected to evolve home automation from a niche market to an “off-the-shelf” cell phone connected industry. Apple’s platform “Homekit” already has over 50 compatible product brands spanning different categories such as lights, locks, thermostats, security, garage doors, outlets, cameras, HVAC systems, window shades, ect. that can all be controlled through the Apple Homekit app.

While convenience might be the most obvious benefit to home automation, it can also improve energy efficiency and reduce consumption costs. One such proven product that has been in stores is the Nest thermostat. Nest replaces standard thermostats but allows you to control it and set schedules anywhere any time through its downloadable app. In addition, it also uses sensors, cloud computing, and algorithms to make adjustments based on settings you prefer, the temperature outside, when you get up, and when you are away.wemo

Another example of an energy efficient home automation product is the Belkin WeMo line. WeMo offers smart plug units and light switches that will automatically turn things off based on a timer or motion, but can also be controlled through a smart phone app.

The innovation of home automation will become even more advanced and fascinating, as analysts predict the smart home product space to grow over 15% in the next few years, and to reach a net worth of $121.7 billion by 2022. Once people have lived with it, they most likely will not be able to ever live without it. The futuristic fantasy of smart homes will very likely become common place in the not so distant future.

 

Energy and Environmental Issues: The Real Challenges in Brazil

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As the Rio Olympics come to a close. The USA is currently leading the medal count amongst all competing nations. From the surface things appear to be going smooth, besides this Lochte issue. However, the preparation to the games was and still remains questionable at best.

Concerns about Brazil’s preparedness to host these Olympics have been rampant in the media. The concerns have centered around the Zika virus, dirty waters, unfinished arenas and living quarters, and dangerous corruption throughout the country. So how did Brazil win the bid back in 2009?

When Rio won the bid national growth was strong and Brazil was in good standing. Under those circumstances it made sense, but things have changed with government corruption and an economic slump causing hardship across the country. One of the more recent tragedies occurred with the collapse of the Tim Maia bike path, which was a legacy project of the Olympics. The $12.6 million path came crashing down killing two people. Engineers concluded that poor engineering was to blame and rushed work throughout the country.

A key factor of the economic hardship is the change in natural resource extraction. Brazil’s economic boom prior to the games was driven by industries like mining. However, mining is proving to be an ecological problem which has stopped much of the work throughout the country. The Bento Rodrigues mine tailings dam burst near the city of Mariana in November 2015 and alerted many to the severe risks.  The incident was Brazil’s biggest ecological disaster, and the responsible companies are facing a $44 billion civil lawsuit, in addition to criminal charges.

Brazil could focus on dams for energy but Brazil also experiences droughts and transmission problems, risking the likelihood of rolling blackouts as reservoirs dry up. Additionally, many of the bids for these projects are corrupt. Belo Monte is a project that was supposed to be a flagship for Brazil’s “green development” agenda. Current investigations have made clear that the bid for the project involved corruption in everything from the construction bidding process to the purchase of equipment, including around $45 million in campaign donations to Brazil’s major political parties

As we watch these games Brazil is in the world’s view. They face a crisis in re-evaluating their development trajectory. What will they do to change the economic development, their energy sources, and their environmental issues?

Only time will tell…

 

Natural Gas Producers’ Bankruptcies and its Impact on Gas Production

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As of May 16th – 77 natural gas and oil producers in North America have filed for bankruptcy since 2015, and 35 of those have done so since the start of 2016…

A recent study conducted by PointLogic Energy explored how much production is represented by these 77 companies, where they are located and the overall impact it is having.

The analysis concluded that 4.4 billion cubic feet per day of gas production and 307,000 barrels per day is represented by the bankruptcy companies.  The production of these companies represents 5.4% and 3.6% of the lower-48 states’ gas and oil production respectively.

 

Some major takeaways from the review:

  • The volume of gas attributed to the companies in bankruptcy is much larger than the corresponding volumes of oil.
    • For Example: In Texas 7.5% of natural gas production is bankrupt while only 2.8% of oil production is represented.
  • There are regional winners and losers: Of the major producing states, Texas, Wyoming, Oklahoma and Louisiana bear the brunt of bankruptcy related volumes. The Northeast and Gulf of Mexico appears largely unscathed.

The overall takeaway when reviewing the companies that have filed for bankruptcy is that they are highly weighted to natural gas, rather than oil products.

So what does it mean going forward? If oil prices recover and producers increase drilling we will likely see an increase in associated gas production, regardless of what natural gas prices are doing. Rising gas production from the associated oil production will inflict even more troubles for the bankrupt market segment with storage constraint worries. The remaining summer looks to be a difficult price environment for natural gas producers, especially in the Texas, Oklahoma, Wyoming and Louisiana regions.

 

Is Tesla becoming the “Big-Box Store” of Energy?

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If you shop at a big-box or wholesale store, you know you can get just about anything you could ever need, and things you think you need, (or want, or think you might need) but really don’t.  Tesla’s latest news is their bid for Solar City, the nation’s largest residential solar company.  Elon Musk, as reported, is the Chairman and largest single shareholder in both entities, and the “deal” ($2.5B) still has to be approved by the SEC.

 

In the big scope of things, here’s how it would break down:

  1. Sun shines (power transformed) by your “Tesla” solar panels installed by “Solar City”
  2. Electricity powering your home also is stored in your “Tesla” Powerwall battery system (Giga-factory in Nevada)
  3. Your Powerwall is charging up your “Tesla” car in the garage (batteries included) manufactured by “Tesla”
  4. When you are bored, take a trip on “Tesla” Space X (rocket ship) to Mars (batteries included)

 

No Utility System needed….click the links below for more details:


http://www.energymanagertoday.com/125437-0125437/

http://bigstory.ap.org/article/5eff8a7c05024bcd85a3d6843432d53e/apparent-conflicts-interest-may-dog-tesla-solarcity-deal

http://www.energymanagertoday.com/drama-aside-tesla-acquisition-of-solarcity-makes-sense-0125228/

 

PJM Capacity Auction: Bad News for generators, Good news for customers

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PJM capacity auction results for the planning year of June 2019 to May 2020 announced 5/24/16, were down significantly, almost 40% across most PJM markets from the prior year.   BAD news for generators as it means less revenue to them, but GOOD for consumers in lower costs.

PJM procured 167,306 MW of power at a clearing price of $100 per MW-day in the majority of the region, down from $164.77 per MW-day last year.  It met a reserve margin of 22.4%, meaning that PJM has excess capacity in the amount of 22.4% of expected peak demand.  It is also the highest reserve margin in PJM auction history, ensuring reliability and availability of power for customers during the term.


PJM Capacity Cost Graph - 6.22.16


The results were somewhat surprising considering PJM’s capacity performance (CP) program. Under this program, which was approved last year, power producers that agreed to deliver electricity whenever PJM determines it is warranted would receive higher capacity payments. PJM’s thought or hope was that the increased revenue would result in generators re-investing into their plant infrastructure, secure fuel contracts, and thus increasing reliability during peak demand periods. However, non-performance under this program results in significant penalties. Penalties that did not exist under the old base capacity program.

The 2019/2020 auction is only the second such event to adhere to PJM Capacity Performance program. In this year’s auction, 80% of the resources had to clear according to “capacity performance” with the remaining 20% clearing under the old capacity product “base capacity”. Next year’s auction for 2020/2021 will move to 100% capacity performance.
The takeaway from this year’s auction and the decrease in price is that there would appear to be adequate generation to meet demand, with more coming on-line.