As reported in Christian Science Monitor

By             , Staff writer / January 8, 2014

The polar vortex gripping the nation is as unpleasant for utilities and grid operators as it is for you. What does the polar vortex mean for your next utility bill?

What happens when much of the nation simultaneously reaches for the thermostat and turns up the heat? Energy prices rise.

With Americans shivering through a “polar vortex,” utilities and grid operators are scrambling to meet demand amid record low temperatures. A stressed power grid and constrained natural gas pipelines are already pushing up the price of electricity and natural gas on wholesale markets.

The good news is that consumers are relatively insulated from the polar vortex’s temporary price shocks (besides the obvious cost increase of turning the heat up for a prolonged period). The bad news is that if this is the first polar vortex of many to come, that prolonged grid strain and need for new infrastructure will almost certainly make its way into the bottom line of your monthly utility bill.

“Most retail customers are set up through regulated natural gas rates for this reason – so that short-term spikes in the spot price don’t automatically flow through,” says M. Tyson Brown, statistician at the US Energy Information Administration (EIA). “To the extent that this is a long-term trend – that really affects the price people pay.” Read the rest of this entry »

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I think we just dodged a bullet! Last week the meteorologists were having a field day tracking this massive storm that was supposed to hit the east coast. High winds, heavy rains. Normally, when we get a bye, the storm sweeps out into the ocean. This storm actually went inland, west of the I95 corridor. Sad to say, they did get substantial flooding.

Why am I talking about the weather, you may ask? Because this is my article, I can choose a topic. Seriously! … Because weather plays a very big part of monitoring natural gas commodity cost.

The current natural gas prices are still the lowest they have been in the last 4 years. September’s NY Index price (the price that providers buy gas) was $.39 cents a therm compare this to $1.41 in July 2008. Quite a difference! Why, you may ask?

First of all, natural gas storage levels continue to be at a 5 year high. Add to that, the shale natural gas that been found in western PA. They are saying this could provide natural gas to the US for the next 100 years.

It is the old supply and demand theory, until the market deems it appropriate to ignore.

For now, market activity show that this is a great time to be buying gas in the deregulated natural gas market. Remember, that since deregulation, the local providers are no longer in the supply business. Therefore they charge you a default rate, which in normally higher. They buy natural gas wholesale and bill their customers’ retail.

HBS puts our clients in a wholesale position. Our clients are finding saving from 10% upto 20+%, depending on who your local provider is.

Since 30% of the electric is generated from natural gas, it also plays an important influence to the current market electric prices. They are also at a 4-year low.

To qualify your commercial natural gas or electric bill should be a minimum of $3000 a month each. Many of our clients are finding substantial saving in the deregulated utility market.

Should you like to know more about savings in the deregulated natural gas and electric market email george@hbsadvantage.com or call 856-857-1230.

Generation: Net generation in the United States rose 8.0 percent from June 2009 to June 2010. The National Oceanic and Atmospheric Administration (NOAA) reported that the contiguous U.S. temperature-related energy demand (REDTI) was the second highest June value on record as “the unusual warmth in the highly populated South and Southeast” weighed heavily. The Federal Reserve reported that industrial production was 8.2 percent higher than it had been in June 2009, the sixth consecutive month that industrial production was higher than it had been in the corresponding months of the previous year.

The rise in coal-fired generation was the largest absolute fuel-specific increase from June 2009 to June 2010 as it was up 17,483 thousand megawatthours or 11.8 percent, and represented over three-fifths of the overall national rise in generation. Texas, Ohio, Alabama, and Pennsylvania showed the biggest gains over June 2009, but the gains were widespread as only 8 of the 48 States reporting coal-fired generation showed lower totals in June 2010. Natural gas-fired generation was second to coal as it was up 8,121 thousand megawatthours, or 9.6 percent. New York, Florida, Massachusetts, Virginia, and Louisiana accounted for 62.0 percent of the national increase. Nuclear generation was down 2.1 percent or 1,434 thousand megawatthours – the largest absolute fuel-specific decline – as there were refueling outages at the Davis Besse, Crystal River, and H B Robinson plants that led to generation totals for these three plants that were far below what they had been in June 2009.

Generation from conventional hydroelectric sources increased 0.6 percent, or 164 thousand megawatthours. The higher level of hydroelectric generation in California was by far the largest contributor to the national rise. Generation from wind was up 44.2 percent, or 2,388 thousand megawatthours. Wind was the energy source with the third-highest absolute megawatthour increase over June 2009. Increased wind generation in Texas, Washington, Kansas, and Oklahoma accounted for 55.1 percent of the national rise. Petroleum liquid-fired generation was up 28.8 percent compared to a year ago, but its overall share of net generation continued to be quite small compared to coal, nuclear, natural gas-fired, and hydroelectric sources. Figure 1 shows net generation by month for the last 12 months.

Figure 1: Net Generation by Major Energy Source:
Total (All Sectors), July 2009 through June 2010

Year-to-date, total net generation increased 3.4 percent from 2009 levels. Net generation attributable to coal-fired plants rose 6.2 percent. Natural gas-fired generation was up 5.2 percent. Nuclear generation declined 1.3 percent, and petroleum liquid-fired generation was down 23.4 percent.

Year-to-date, coal-fired plants contributed 45.9 percent of the power generated in the United States. Natural gas-fired plants contributed 21.8 percent, and nuclear plants contributed 19.9 percent. Of the 0.9 percent contributed by petroleum-fired plants, petroleum liquids represented 0.6 percent, with the remainder from petroleum coke. Conventional hydroelectric sources provided 6.8 percent of the total, while other renewables (biomass, geothermal, solar, and wind) and other miscellaneous energy sources generated the remaining 4.4 percent of electric power (Figure 2).

Figure 2: Net Generation Shares by Energy Source:
Total (All Sectors), Year-to-Date through June, 2010

Consumption of Fuels: Consumption of coal for power generation in June 2010 was up 10.4 percent compared to June 2009. Consumption of natural gas rose 10.0 percent. For the same time period, consumption of petroleum liquids was up 27.9 percent, while petroleum coke rose 15.2 percent.