Texas-size Energy Spike

[don]

The weather story is having a big impact on companies and associated commodities today, but this may be the biggest move we've seen thus far.

In Texas, the price of electricity has surged as a result of the recent storm.
The rolling blackouts started Wednesday as a result of the weather, and have continued today, according to the Wall Street Journal.

But just what does that look like for energy markets? ERCOT (Energy Reliability Council of Texas) has seen on peak prices in its Northern Territory spike as high as $330.64 per megawatt hour today.

Just yesterday those prices were at $70. In the days before, they were trading between $34 and $45.

Data provided by Bloomberg:

http://www.businessinsider.com/check...#ixzz1CqAdTQ3o

[lektrode]

Re: Texas-size Energy Spike

The weather story is having a big impact on companies and associated commodities today, but this may be the biggest move we've seen thus far.

the 'ghost of enron' and the 2nd coming?

but surely "this isnt inflationary" according to krugman....

[strittmatter]

Re: Texas-size Energy Spike

The area between the Dallas and OK border recorded low's down to 9 degrees F last evening. Quite an anomoly here, nowhere near normal climate characteristics therefore most don't insulate & proof their dwellings to that extent. We do keep the light bill paid however, yet when our Energy "Reliability" Council of Texas hit us with our first of several blackouts at around 5:30 am, the juice was off just long enough that some of my household plumbing froze. Not a major tragedy, managed to get it all thawed before something busted all to hell.

A substantial number of homes in the DFW metro have been without power for several hours. Local radio was flooded with calls from soured home owners unable to make human contact with local utilities and many reported spending most of the day in their parked vehicle.

How bout them de-regulators! When you run the sheriff out of town, the only ones left to rule the roost are the crooks.

http://www.texastribune.org/texas-en...ncy-blackouts/

[c1ue]

Re: Texas-size Energy Spike

It is possible that at least part of this is due to Texas' attempted reliance on wind energy.

Cold weather is one of the worst possible situations for wind energy:

1) Turbines break





http://wattsupwiththat.com/2011/02/0...ng/#more-33030

2) Winds tend to be low with record low temperatures

http://wattsupwiththat.com/2011/02/0...ling-blackout/

[Ghent12]

Re: Texas-size Energy Spike

1) Turbines break

2) Winds tend to be low with record low temperatures

3) Ice on the wind turbine blades change their shape, sometimes vastly reducing efficiency.

[c1ue]

Re: Texas-size Energy Spike

Speaking of ice...

http://www.globalmontreal.com/techno...952/story.html

Really funny: "We can't control the weather" - from the turbine farm operator - speaking about a wind farm in New Brunswick, Canada! It never gets cold in Canada, eh?

Really sad: $200 million for this project in order to sometimes provide power to 19,000 homes. That's enough to buy out at least 1 in 10 of those homes at the average wind spend of $10,500 per home served plus a no doubt feed in tariff.

FREDERICTON — A $200-million wind farm in northern New Brunswick is frozen solid, cutting off a potential supply of renewable energy for NB Power.
The 25-kilometre stretch of wind turbines, located 70 kilometres northwest of Bathurst, N.B. has been completely shutdown for several weeks due to heavy ice covering the blades.
GDF SUEZ Energy, the company that owns and operates the site, is working to return the windmills to working order, a spokeswoman says.
"We can't control the weather," Julie Vitek said in an interview from company headquarters in Houston, Texas. "We're looking to see if we can cope with it more effectively, through the testing of a couple of techniques."
She says the conditions in northern New Brunswick have wreaked havoc on the wind farm this winter.
"For us, cold and dry weather is good and that's what's typical in the region. Cold and wet weather can be a problem without any warmer days to prompt thawing, which has been the case this year.
"This weather pattern has been particularly challenging."
Wintery conditions also temporarily shutdown the site last winter, just months after its completion. Some or all of the turbines were offline for several days, with "particularly severe icing" blamed.
The accumulated ice alters the aerodynamics of the blades, rendering them ineffective as airfoils. The added weight further immobilizes the structures.
Vitek says workers are trying to find a way to prevent ice buildup from occurring again in the future. The shutdown has not had any effect on employment at the site, which provides 12 permanent jobs.
In February 2008, Suez was awarded a contract to build a 33-turbine wind farm at Caribou Mountain. NB Power signed a 20-year power purchase agreement for its 99 megawatts of power capacity, which went online in November 2009.
At the time, the project was praised for bringing NB Power to its goal of having 400 megawatts of wind power capacity by 2010. The facility has enough capacity to power about 19,000 homes.
Melissa Morton, a spokeswoman for the utility, says the contract isn't based on power delivered during a specific period, but rather on an annual basis.
"Although there may be periods when production is down from what would be expected, there are also periods when production is above what would be expected," she says.
"We only pay for the energy that actually goes on our transmission system."
But with energy market prices changing constantly, she says there's no way to know if NB Power is paying more or less for replacement power.
"It can be more expensive. It can also be cheaper," she says, but fluctuations in production at other sites can make up the difference.
"Our hopes is that it will balance out over the 12-month period and, historically, that has been the case."
Despite running into problems in consecutive winters, Morton says NB Power doesn't have concerns about the reliability of the supply from the Caribou Mountain site.
Suez's website states its wind farms on average produce about 35 per cent of their capacity on an annual basis, accounting for daily and seasonal fluctuations in wind patterns.
David Coon, executive director of the Conservation Council of New Brunswick, says winter tends to bring higher winds to the province, which would push wind farms to produce more power.
He says the problems at Caribou Mountain are confusing, as other projects in cold climates haven't had similar ice issues.
"I don't know why, because there's a lot more wind (farms) to the north of us in Quebec, so I don't know why in particular they're having trouble," he says.
NB Power also has contracts to buy power from other wind facilities in the region.
A TransAlta-owned wind farm, located south of Moncton, consists of 32 turbines. An additional 18 turbines are being constructed at the site, which will make it the largest wind farm in Atlantic Canada.
NB Power also has power-purchase agreements with the Acciona wind project in Lamèque and another Suez farm on Prince Edward Island.
Suez operates a second wind farm on the Island, as well as owning facilities in Central and South America and across Europe.