Today in Energy
Asian demand spurs U.S. net exports of petroleum coke to higher levels in early 2012
U.S. net exports of petroleum coke—a byproduct of oil refining —continued at higher levels over the combined January-February 2012 period. Demand for U.S. petroleum coke, or sometimes called "petcoke," is strongest in Asia, where it is used for generating electricity, making steel, and manufacturing cement.
tags: China , distillate fuel , exports , gasoline , oil/petroleum , petroleum coke , refining
OPEC spare capacity in the first quarter of 2012 at lowest level since 2008
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The U.S. Energy Information Administration (EIA) estimates that global spare crude oil production capacity averaged about 2.4 million barrels per day (bbl/d) during the first quarter of 2012, down about 1.3 million bbl/d from the same period in 2011 (see chart above). The world's spare crude oil production capacity is held by member countries of the Organization of the Petroleum Exporting Countries (OPEC). Spare capacity can serve as a buffer against oil market disruptions, and it gives OPEC additional political and economic influence in world markets. There is little or no spare capacity outside of the OPEC member countries.
tags: capacity , crude oil , international , liquid fuels , oil/petroleum , OPEC , prices , production , WTI (West Texas Intermediate)
Horizontal drilling boosts Pennsylvania’s natural gas production
Between 2009 and 2011, Pennsylvania's natural gas production more than quadrupled due to expanded horizontal drilling combined with hydraulic fracturing. This drilling activity, which is concentrated in shale formations that cover a broad swath of the state, mirrors trends seen in the Barnett shale formation in Texas.
tags: animation , drilling , natural gas , Pennsylvania , production , shale
Electricity storage can smooth out moment-to-moment variations in electricity demand
Note: Data represent no particular region. "Actual" data include a 2% fluctuation around the average or "smooth" data at one minute intervals.
Electricity storage technologies that operate on short timescales (seconds, minutes, hours) can be used to keep a more precise balance between electric supply and demand. These power quality management technologies can fill the gaps between actual electric demand and an average, smooth demand curve that is easier for typical supply sources to follow (see chart above). However, a potential barrier to adopting these technologies is finding a way to get paid for the service they provide. Previous articles in Today in Energy discussed electricity storage and its longer-timescale applications. This article focuses on storage that performs best on short timescales, serving a different set of needs on the electric power system.
tags: capacity , demand , electricity , generation , storage , transmission
Electricity storage can take advantage of daily price variations
Electricity storage technologies that can operate on timescales such as hours or days are often deployed at specific times of day to take advantage of variations in the price of electricity (see chart above, right). Storage operators can buy electricity when prices are lower (overnight or on weekends), store it, and then discharge or deliver it later, selling the stored electricity when prices are higher (daytime, weekdays). Following a previous article introducing electricity storage technologies and functions, this article focuses on technologies that operate on these longer timescales, or energy management technologies, and their two overarching benefits to the electric power system: flattening the daily load shape (see chart above, left) and integrating variable generation like wind.
tags: capacity , demand , electricity , generation , hydroelectric , prices , storage
Warm weather and low natural gas prices dampen spot electricity prices this winter
The combination of one of the warmest winters (November-March) in decades and low spot natural gas prices contributed to low wholesale electric prices at major market locations during the winter of 2011-2012 (see chart below). Warm weather kept electric system load low across the East Coast and helped dampen the need for coal-fired generation. Natural gas generation was up significantly to take advantage of low natural gas prices. Reduced nuclear generation due to outages and reduced hydropower generation both served to moderate declining electricity prices in much of the country.
Note: Data include day-ahead, on-peak prices from Mid-Columbia (near the Washington and Oregon border), CAISO NP-15 (northern California), CAISO SP-15 (southern California), Palo Verde (in southwest Arizona), PJM N. Illinois Hub (northern Illinois), ERCOT Houston Zone, Entergy (Louisiana), PJM Western Hub, NYISO Zone J (New York City), NE-ISO Mass Hub (New England), MISO Illinois Hub (Illinois), and Into Southern (Southeast) pricing points.
On-peak, wholesale electricity prices generally ranged from $20-$50 per megawatt hour last winter, with some exceptions. Electricity prices dropped during the winter, especially starting in January, as spot natural gas prices neared their lowest levels in the past decade.
Much of the United States saw warmer-than-normal weather during the winter of 2011-2012. The national population-weighted heating-degree days (HDDs) were down 13 to 36% relative to normal weather from November to March. Every part of the country was warmer than normal for the winter except the Pacific region, which was just slightly (2%) cooler than normal, but even in the Pacific region winter load was down.
While the percentage of buildings heated with electricity is smallest in the coldest regions of the country, electric power prices are nonetheless often tied to winter weather. This is because power prices often reflect the operating costs of marginal natural gas generators, and natural gas fuel prices are keenly sensitive to winter weather (colder temperatures mean more gas burned for space heating).
Electric system load was below the five-year average for winter months in New England, the Pacific Northwest, California and much of the central United States (MISO). Winter load levels were elevated in PJM compared to previous years. However, the system footprint of PJM has expanded over time making comparisons difficult. The ERCOT system has seen load growth as well, but unlike PJM, this was due to population and industrial demand growth in Texas. System demand in the Bonneville Power Administration was near the bottom of the five-year average although temperatures were slightly below normal. Spikes in winter demand for electricity are less common in the Bonneville system due to the generally temperate climate in the Pacific Northwest.
Natural gas generation during the winter of 2011/2012 (November through February, the latest electric power data available) was up 69 billion kilowatthours compared to the prior winter, despite the generally low demand for electricity. Natural gas generation climbed far above the five-year range, especially starting in January when spot natural gas prices began to fall. At the start of winter 2011/12 spot natural gas prices at Henry Hub were about $3.50/MMBtu—low by recent historic levels. By the end of winter, spot natural gas prices were heading under $2/MMBtu, nearing 10-year lows.
Coal generation, on the other hand, for the same period was much lower than the most recent five-year range. In November and December 2011, coal's share of total U.S. electricity generation fell to its lowest monthly level since 1978.
Hydroelectric output in the Pacific Northwest was near the five-year average and well below the record levels of last year. Because of the significant hydroelectric capacity in the Pacific Northwest, the level of hydroelectric output can have significant price effects throughout the Western Interconnection.
Nuclear power plants outages were elevated in the late winter and early spring due to the combination of several forced outages and the start of the spring refueling cycle. Because of the low fuel cost and high utilization rates for operating nuclear plants, an extended nuclear outage can have significant electricity market effects.
tags: coal , demand , electricity , ERCOT , hydroelectric , MISO , natural gas , nuclear , PJM , prices , spot prices , weather
Global generation capacity for nuclear power has grown to over 346 gigawatts since 1955
Note: Annual data.
Nuclear generating capacity additions began in the 1950s and now top 346 gigawatts worldwide (click on animation above to assess trends). The first nuclear reactor to produce electricity was a very small experimental reactor in the United States in 1951. Currently, 30 countries have nuclear power programs.
tags: capacity , electricity , generation capacity , international , nuclear
Natural gas consumption reflects shifting sectoral patterns
Note: Charted consumption data includes the four largest natural gas-consuming end-use sectors.
U.S. natural gas consumption since 1997 reflects shifting patterns. Total U.S. natural gas consumption rose 7% between 1997 and 2011, but this modest growth masks bigger changes in individual sectors. Electric power is now the largest natural gas-consuming sector and it shows perhaps the greatest sensitivity to price changes. The graphics below highlight key factors that influence natural gas consumption.
tags: commercial , consumption , electricity , industrial , natural gas , residential
Participation in electric net-metering programs increased sharply in recent years
Note: The chart counts the number of net-metering customers and does not indicate the generator size or amount of generation. Non-residential includes the commercial and industrial sectors; net-metered generators in these sectors are typically larger than residential generators.
Electricity consumers are participating in net-metering programs in growing numbers. When individuals or businesses install small onsite generators (such as a rooftop solar system), they can usually enter into a net-metering agreement with their utility. Between 2003 and 2010, the average annual growth in customer participation was 56%, with a 61% increase between 2009 and 2010. While participation is increasing, electric customers with net metering represented only 0.1% of all customers in 2010.
tags: capacity , commercial , electricity , generation , generation capacity , industrial , net metering , renewable , residential , solar , states
State electric retail choice programs are popular with commercial and industrial customers
Seventeen states and the District of Columbia have adopted electric retail choice programs that allow end-use customers to buy electricity from competitive retail suppliers. While residential customer participation rates are low in almost all of these states, a majority of commercial customers have signed up with competitive suppliers in 9 states and a majority of industrial customers have signed up in 12 states. The highest participation rates are found in the Northeast, Mid-Atlantic states, and Texas where electricity is supplied through Regional Transmission Organizations (RTOs) and states have unbundled generation from retail delivery and sales.
tags: CAISO , Connecticut , electricity , ERCOT , Midwest , New England , prices , retail prices , RTO (regional transmission organization) , West
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