Weekly Power Outlet US - 2024 - Week 46
Natural Gas Rally, ERCOT Crypto, EIA Grid Infrastructure
Natural Gas Rally, ERCOT Crypto, EIA Grid Infrastructure
Energy Market Update Week 46, brought to you by Acumen.
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December contract natural gas has been on some ride this November. On November 2, gas was sitting near the $2.50 MMBtu. Fast forward to yesterday where it briefly touched $3.60 from $2.70 a few days earlier. It's fair to assume some of the technical traders are going to walk away on an overbought signal, and we might be seeing that today. So, what's with the move?
A couple images below tell the story. Winter is apparently actually threatening to show up in the northern part of the country, and Europe has been in a big drawdown. Heading into this month, both Europe and the US were sitting at historical storage levels for this time of year and the markets reflected it. European natural gas benchmark TTF traded to near €47 per MWh (roughly $14.5 MMBtu). These levels are the highest in the previous 12 months and have doubled since February lows. The drawdown in rise in prices are being attributed to cold weather and low wind.
As would be expected, the electricity futures we followed all saw significant upticks following the rally in gas this week.
Yesterday the Public Utility Commission of Texas approved a rule requiring registration of "virtual currency mining facilities". or crypto.
This statement was taken from the release, "To ensure the ERCOT grid is reliable and meets the electricity needs of all Texans, the PUCT and ERCOT need to know the location and power needs of virtual currency miners,” PUCT Chairman Thomas Gleeson said. “This is another example of the PUCT and ERCOT adapting to support a rapidly changing industrial landscape. Most importantly, we will always take the steps necessary to ensure reliable, affordable power for all Texans.”
We haven't seen a response from any crypto firms yet, but note that the penalties for non-registration are significant. As AI and compute computing become more and more a part of the landscape, it will be interesting to see what similar rules are coming.
Speaking of compute load, the drive to upgrade infrastructure on the grid has finally gotten some long overdue attention (our opinion). This week EIA released some interesting statistics in it's Today in Energy release. Below is one chart from the report showing where utility spending has gone over the previous 20 years. The report is worth a read.
The WPO will take a week off for US Thanksgiving next week. Enjoy the family time, turkey, parades and horrible football matchups (our opinion again).
NOAA WEATHER FORECAST
DAY-AHEAD LMP PRICING & SELECT FUTURES
RTO ATC, PEAK, & OFF-PEAK CALENDAR STRIP
DAILY RTO LOAD PROFILES
COMMODITIES PRICING
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