Top 10 energy management news items from last week . . .
Building Industry Groups Launch the International Green Construction Code
Leading U.S. building industry groups have launched the International Green Construction Code, a model regulatory framework for the construction of high-performance commercial buildings.
EPA May Track Emissions from Oil, Gas, Other Sectors
The U.S. Environmental Protection Agency proposes collecting emissions data from more industries, including Oil & Gas companies, as well as industries that emit fluorinated gases and facilities that inject and store carbon dioxide underground.
Federal Agencies Clamp Down on Energy Eaters
Manufacturers will have to work much harder to earn the right to affix the ENERGY STAR logo to their products.
Bridgelux Trots out LED Replacement for Light Bulbs
It's cheap. It's bright. And it snaps in.
71% Aware of Energy Star Label Meaning
About 71 percent of Americans are aware of the Energy Star label and its implications, according to a new report from EcoAlign.
U.S. Utilities Increase Energy Efficiency Programs 43% to $5.3B
U.S. utilities spent 43 percent more on energy-efficiency programs in 2009, according to a new report from the nonprofit Consortium for Energy Efficiency (CEE), which represents energy efficiency program administrators in the United States and Canada.
China's Cleantech Spending Blows Past United States
China is on the verge of becoming the most active country in the cleantech sector, based on watts of energy installed. Will the United States fall behind?
Lighting Retrofit Earns Award for "Energy Project of the Year"
The Center for Energy Efficiency (CEE) has granted its 2010 award for "Energy Project of the Year" to Fushi Copperweld (NASDAQ:FSIN) for a lighting retrofit that reduces electricity consumption by 2.1 million kWh.
Utilities Struggle to Win Over Smart Meter Skeptics
One of the biggest challenges facing utilities the world over is educating customers on the merits and realities of smart meters. Texas power company Oncor is taking their smart energy show on the road.
The Politics of Greentech: Schwarzenegger & Tax Breaks
Thin film solar firm Nanosolar says it will be able to save tens of millions of dollars, and expand its business in California and create new jobs, thanks to a new manufacturing tax incentive bill signed into law by California Governor Arnold Schwarzenegger on Wednesday.
U.S. Natural Gas Boom Dead Obvious, So Don't Kill It
Shale gas rig count activity is exploding right now, and is well ahead of even the impressive recovery in rig activity for conventional energy plays.
Photo by Jontintinjordan
In December, even as energy prices were spiking on colder-than-normal temperatures, Prenova's analysis pointed out a number of bearish indicators in the energy markets. Despite expected skepticism from some, we predicted a 33% decline in prompt month prices by the end of the winter heating season. So how are we doing with this prediction?
Following that very cold December, January temperatures were warmer than normal in many key regions. This eased demand for energy and caused prices to fall by 8.6% through February 1st. Then some colder-than-normal temperatures in early February increased demand for natural gas once again, causing concern that the March NYMEX prompt-month price would rise. But due to the aforementioned bearish forces, natural gas prices continued to fall, declining another 990 basis points thru the end the month, down about 18.5% from the December highs.
So, here we are near the end of March. We've been waiting patiently, and the NYMEX prompt-month price has now declined by nearly 31% from the highs experienced in December. The April 2010 contract expires in a little over a week, and the prompt month price of $5.996 per mmbtu on December 28th has now fallen to $4.086 per mmbtu as of March 18th.
Why did this happen? Well, it's simple. The fundamentals of supply & demand kicked in.
- Even with colder-than-normal temperatures this winter, there has been ample natural gas production and more than enough storage to accommodate demand.
- Advancements in the process of extracting natural gas from shale formations have significantly increased reserves, boosting production yields and capacity.
- Continuing recessionary pressures have limited demand for natural gas from the commercial and industrial sectors.
There are a few other factors, but suffice it to say that both natural gas supplies are abundant and demand is down. As a result, we're seeing prompt and forward 12-month natural gas strip prices at six-year lows. While we believe the outlook for natural gas is still bearish, we also see less downside opportunity and greater upside risk.
Natural gas underground storage currently stands at 1,615 bcf. To reach an end-of-season storage level of 1,350 bcf, withdrawals would need to average 88 bcf per week for the remainder of the heating season. For the last five years, late season withdrawals have only averaged 19 bcf per week, and the 15-year average is only 27 bcf per week. So it's very unlikely we'll get as low as 1,350 bcf. This means natural gas prices should stay at or near $4 per mmbtu for the next few month.
Electricity prices are tied to natural gas prices, so look for prices to remain low through April and May. We will see the typical Spring Bounce in prices as we move into June, when the peak electric consumption season begins.
Oil futures are slightly over their recent trading range of $70 to $80/bbl, in part bolstered by OPEC and IEA announcements raising their projected oil demand levels in late 2010 on improving global economies.
The week's edition of Energy Management News features cows, manure, and the EPA.
Dead Cows, Earthquakes, and the Future of Green Energy
Dead cows, water-well explosions, and contaminated groundwater from drilling are hurting Chesapeake Energy's efforts to market natural gas as a clean alternative to coal.
Government Roadblocks Private Production of Biogas
Turning manure into fuel means dealing with a lot of red tape.
Is Demand Response Clean?
Demand response rarely results in a significant reduction in energy use because load is either shifted to off-peak hours or substituted by a backup generator. Does that sound clean to you?
NY Injects $100M into Energy Efficiency Projects
New York companies will be able to improve the energy efficiency of their manufacturing facilities and data centers with the addition of $100 million in funds from the New York State Energy Research and Development Authority (NYSERDA).
LA Mayor Proposes Carbon Surcharge on Energy Bills
Customers of the Los Angeles Department of Water and Power may one day see a carbon surcharge added to their bills. Mayor Antonio Villaraigosa has proposed a surcharge to help shift the utility away from coal power.
Prepaid Electric Service Launched
Texas utility First Choice Power becomes the first affiliated retail electric provider in the state to offer consumers a prepaid service option.
AT&T Launches Smart Charger to Fight Vampire Power, Finally
The phone company says it will start selling a smart charger in May - dubbed the AT&T ZERO charger and made by Super Communications - that eliminates vampire power (wasted standby power).
EPA to Phase in CO2 Emissions Permits
The Obama administration will give small businesses a break on coming carbon dioxide emissions rules but big emitters like coal-fired power plants will face a crack-down.
How Congress Accidentally Saved Us Millions
Legislation that halted purchases of oil for the Strategic Petroleum Reserve in 2008 aimed to push gas prices down - it didn't work. Nevertheless, the legislation still delivered positive results.
Industry Reacts to Smart Meter Anger
Oncor faces customer backlash over smart meters and skyrocketing electric bills.
Photo by JelleS
Outlook: Prenova's view of storage remains 'bearish'. Despite colder-than-normal temperatures this winter across much of the U.S., it would take phenomenal circumstances to cause the current storage levels to go below the initial end-of-winter storage estimate of 1,350 bcf (which is a 'very comfortable' level). Look for this market factor to keep nat. gas prices low through early May.
In this edition, Michael Roberts, Prenova's lead energy analyst updates his market forecast based on recent data from the U.S. Energy Information Administration and other sources.
Report Emphasizes Need to Reduce U.S. Consumption of Petroleum
An attempt to account for the energy security costs of domestic and imported oil finds higher security costs for imported oil. However, the costs are low compared to the direct cost of oil, implying that U.S. energy security efforts should focus on lower petroleum use, regardless of its source.
Demand Side Energy Management Gains Converts
David Konkle, Energy Office Director of the ICLEI - Local Governments for Sustainability - speaks at a Northwest Michigan Sustainable Business Forum workshop focusing on demand side energy management.
T-RECs Invade California Energy Market
To meet renewable goals, California utilities can buy power from Arizona households. It's a new ball game.
Doors Open to Offshore Energy Production in Virginia
The National Ocean Industries Association announced its support of Virginia Governor Bob McDonnell (R) and the Virginia General Assembly for their bipartisan agreement in enacting two state laws supporting energy development off the state's coast.
Smart Grid May Need Security Tutoring
Smart meters have the potential to both lower electrical costs for consumers around the world and promote emerging M2M applications for the corporate world. But at last week's RSA Security Conference in San Francisco, a panel of experts also outlined some key areas of vulnerability for IP-based smart grids.
Home Depot Works to Further Reduce Energy Use
Home Depot already has made changes that reduced its energy use by 16% -- enough to power more than 200,000 U.S. homes for a year. Other plans include lowering lighting wattage and upgrading heating and cooling systems.
California to Regulate Potent GHG Emitted By Utility Equipment
California will regulate the emissions of sulfur hexafluoride (SF6) from electric utility equipment starting in 2011, reports the New York Times. SF6 is used to insulate switches typically found in high-voltage transmission systems, which accounts for about 80 percent of California's total SF6 emissions.
Strategizing for the Ethanol Industry
Should Congress extend the Volumetric Ethanol Excise Tax Credit (VEETC), which essentially pays petroleum producers for complying with US law? The Corn industry thinks so, but not everyone agrees.
Is Energy Storage a Product or Service?
Why sell utilities the cow when they can get the electricity for a fee?
Is Nuclear Necessary? Duke Study Touts Power of Renewables
How necessary is nuclear power? A new study from Duke University suggests renewable energy, including solar, wind and hydroelectric, can meet all but 6% of North Carolina's electricity needs.
Photo by Gideon Tsang
Prenova's Kristen Murphy discusses Senate Bill 695, which reopens the direct access market to commercial and industrial customers in the state of California. The bill will enable some local businesses to work with a third-party energy supplier, rather than being tied to the local utility. This brings greater flexibility to the California market by giving consumers more options to choose from.
Photo by Caveman
Shareholder Climate Resolutions Up 40%
U.S. investor groups have filed 95 global warming shareholder resolutions with public corporations, a 40 percent increase over last year, according to a press release from the Investor Network on Climate Risk.
Making Energy Efficiency Easy to Finance
CalCEF and Metrus Energy show how to institute energy efficiency in buildings with zero upfront cost.
China Has "No intention" of Capping Emissions
The country's top climate change negotiators says China has no intention of capping its greenhouse gas emissions, even as authorities are committed to realizing the nation's target to reduce carbon intensity through new policies and measures.
Home Depot Shoots for 20% Reduction in Supply Chain Emissions Over 5 Years
Home Depot has set a goal to reduce its greenhouse gas emissions related to the domestic supply chain by 20 percent over the next five years. The retailer expects its supply chain to benefit from a move to a centralized distribution network.
U.S. Wind Energy Potential Larger than Previously Estimated
A new study by DOE's National Renewable Energy Laboratory (NREL) finds that U.S. wind resources could generate nearly 37 million gigawatt-hours annually. The study represents the maximum amount of wind power that could be reasonably developed in the contiguous United States.
Energy Efficiency vs. Energy Conservation
Energy Efficiency and Energy Conservation are sometimes used interchangeably, but shouldn't be. In reality, they represent radically different approaches to controlling energy costs.
Texans Question the Benefits of Deregulation
Eight years after state legislators deregulated the electric industry Texans continue to question the wisdom of the ruling and whether it has helped or hurt consumers.
Push Begins for ‘Building Star' Incentives for Commercial Properties
First there was Energy Star, the long-established energy ratings system. Then came Home Star, an incentive program supported by President Obama. Now, the Senate has introduced a bill that would establish a Building Star program to provide incentives to commercial buildings related to their energy efficiency.
Photo by Katrina.Tuliao
Michael Roberts updates his outlook on natural gas and electricity prices for 2010.
Vermont Says "No" to Nuclear Power
The Vermont legislature has decided that it's done with nuclear power. Last week, state senators voted overwhelmingly in favor of shutting down Vermont's only nuclear plant, which currently provides about 75% of the state's electricity.
How Risky Are Energy Efficiency Investments?
Last week's announcement of $8.3 billion - and possibly as much as $54.5 billion - in US federal loan guarantees for nuclear power plants sparked debate about risk of default on loans. What are the chances the plants will be built?
U.S. Utilities Spent $5.3 Billion on Energy Efficiency Programs in 2009
U.S. utilities increased their spending on energy efficiency programs by 43% in 2009, reaching $5.3 billion, according to a new report from the Consortium for Energy Efficiency. Spending increased the most in the Southeast and South Central states, most notably in Kentucky, Maryland, and Tennessee.
New Reports Suggests Smart Grid Attack Likely
The Project Grey Goose Report on Critical Infrastructure says attacks against the power grid are expected to increase over the next year.
All New Office Depots to be Built to Energy Efficient, LEED Standards
Office Depot is adopting an energy efficient and green building model for the interiors of all new stores. Office Depot recently unveiled a prototype energy efficient store in Austin, Texas, that was LEED certified.
Is Bloom Energy Beginning to Fade?
Bloom Energy finally had its big day, showing off its "energy source of the future" to crowds of admiring politicians and press. The company hyped its gas-burning fuel cell on 60 Minutes, generating a wave of news reports and public enthusiasm, but the real story is less impressive.
Photo by Christopher Peterson