April coal exports continue to be the lone bright star for domestic coal producers as domestic coal demand fails to rebound from already dire 2017 levels. Strong world coal markets, with CIF ARA thermal coal and Australian low-vol HCC metallurgical coal continuing to trade at high levels, enabled U.S. coal exporters to record the highest […]
EVA Forecasts Record Natural Gas Demand for Summer 2018
On May 31, 2018, Natural Gas Supply Association (NGSA) released a report on 2018’s Summer Outlook for Natural Gas. The report was prepared by Energy Ventures Analysis (EVA). Record natural gas demand in the summer of 2018 is expected to be accompanied by a record summer-over-summer production growth, the highest production increase since 2005. Storage […]
Despite Short Month, U.S. Coal Exports Remain Strong as U.S. Coal Exporters Work Through Backlog
Despite it being the shortest month of the year, U.S. coal exporters were able to add to the already high levels of U.S. coal exports, shipping out 9.7 million tons of coal in February 2018, extending the +9 million tons of exports streak now to seven consecutive months. Increases in met coal exports were the […]
2018 Outlook for Gas Pipeline Capacity in the Northeast
Since the beginning of the shale era, the North American natural gas industry has been keenly focused on the outlook for key pipeline takeaway projects in the Northeast. Recently, several major pipeline projects—most notably, Rover Phase 1 and Leach/Rayne Xpress—have been placed into service and have allowed Northeast gas production to reach record highs. Even […]
Different Shades of Cold: The 2018 Arctic Outbreak vs. the 2014 Polar Vortex
Following a mild start to this winter, cold weather finally arrived in late-December, with a record-breaking freeze sweeping down from Canada and spreading across nearly the entire U.S. east of the Rockies. The blast of cold has had an immediate impact on the market, causing production freeze-offs, surging heating demand and spiking gas and power […]
Rover Phase 1B Seeks Final FERC Approval
On the morning of Dec 4, Energy Transfer Partners submitted a request to FERC to bring Phase 1B of its Rover Pipeline in service by December 14, 2017. Although horizontal directional drilling (HDD) work was halted earlier this year, Phase 1B progress is actually slightly ahead of schedule according to our gas pipeline tracker. Phase […]
SoCal Gas & Power Prices Rising Sharply Heading into December
December gas prices for SoCal Citygate increased dramatically over the last six weeks. On Monday, the December contract settled at $6.21/MMBTU, its highest settle in four years and more than $2/MMBTU higher than its average through 2017. The prospect of higher gas prices has also pushed SP-15 December power prices to record highs. As noted […]
Forget the rig count — efficiency reigns supreme in the Marcellus
Dry gas production in the Marcellus and Utica, which now comprises about 35% of total U.S. L-48 dry gas production, has steadily increased through 2017. The consistent increase in output has coincided with rising rig counts, as well, but total rigs remain well below 2014 peaks. This is a clear sign that producers in the […]
Lone Star Solar: Amid plummeting costs, solar is set to soar in Texas
Texas has long stood alone as the clear leader in wind development in the United States. As of August 2017, the state has 21.1 GW of wind capacity, which represents a full 25% of total U.S. capacity and is more than 3 times the capacity in Iowa, the country’s second leading wind state. Notably, Texas […]
New natural gas pipeline capacity may outpace production gains over next several months
Over 16.4 BCFD of new natural gas pipeline capacity is expected to come into service between now and October 2018. A large chunk of this capacity (7.2 BCFD) aims to provide incremental production takeaway capacity, primarily in the Marcellus/Utica region (see map below). However, EVA’s most recent natural gas production forecast suggests these pipelines may […]
Clean Power Plan Repeal Finally Picks Up Steam
On October 10, 2017, the U.S. Environmental Protection Agency (EPA) added another chapter to the story of one of the most contentious environmental regulations, when EPA Administrator Scott Pruitt issued the proposed Clean Power Plan Repeal Rule. This action, almost 200 days after President Trump ordered the EPA in his Executive Order to Promote Energy […]
Metallurgical Coal Production drops in Third Quarter, Despite Strong Market Conditions
Quarterly coal production data from the Mine Safety and Health Administration (MSHA) show a significant drop in metallurgical coal production for the third quarter in 2017. While year-to-date metallurgical coal production is still well above 2016 levels (+26.7% through Q3), quarter-on-quarter production data shows a 9.5% decline, despite strong export market conditions for U.S. met […]
Unprecedented Outage Cuts Gas Flows on TETCO Southbound
Around 11pm on Oct 11, Texas Eastern Transmission (TETCO) declared a force majeure on an unplanned outage that occurred on the gas pipeline just south of its Berne Compressor Station in eastern Ohio. As of mid-morning on Oct 12, TETCO has not yet provided an estimate for when service will be restored. As a result of […]
Pumping the PURPA Brakes: North Carolina opts for a more competitive solar development process
Renewable energy development in the Southeast U.S. has been largely non-existent, with the notable exception of North Carolina. Even there, wind development has been scarce, but the state has emerged as the nation’s second largest state for utility scale solar, behind only California. Having added 828 MW in 2015 and 758 MW in 2016, North […]
Sabine Pass LNG fills the tanks while waiting for Harvey to pass
Despite devastating much of Texas’ Gulf Coast, Hurricane Harvey has by all accounts spared Sabine Pass LNG, located on the Texas-Louisiana border. Owner and operator Cheniere has said operations were largely unaffected by the storm and corresponding deluge. Yet, no LNG cargoes have been loaded at the facility since Thursday 8/24 (just before the storm […]
Iranian Oil: Not Quite Open for Business
With the UN sanctions relief, Iran is seeking to revitalize its oil industry and already has raised oil production to near pre-sanction levels. The National Iranian Oil Company (NIOC) aims to increase production capacity through 2021 to 4.8 MMBD by appealing to global oil majors for capital investments and renovations to their drilling and production […]
Retail NEM: Still controversial, but a consensus begins to emerge on this key driver of rooftop solar installations
Rooftop PV installations have soared in the U.S. over the past several years, but activity has been heavily concentrated in just a few states offering strong policy support. Retail net energy metering (NEM), which allows the homeowner to sell surplus solar power back to the grid at retail rates, has been a particularly critical driver […]
OPEC Fails to Reduce Global Oil Production Putting Downward Pressure on Oil Prices
While global oil production data for June is still preliminary, it indicates that global oil production is now above Oct. 2016 levels, despite OPEC’s plan to reduce supply. As illustrated in Exhibit 1, despite OPEC’s Big 4 reducing production levels 1.45 MBD, production increases for OPEC’s two wild cards and Non-OPEC’s Big 4, which is […]
New Coal & Gas Price Sensitivity Outlook Projects 2017 Coal Generation to Actualize Lower than Expected
EVA has published its July Coal & Gas Price Sensitivity Outlook. The report provides insight into how Coal-to-Gas (C2G) competition may evolve given pending changes to fuel pricing and the fundamental structure of the electric power markets. EVA’s Scenario Analysis (SCAN) of modeled assumptions provides high-level insight into a broad range of market-driven outcomes. Highlights […]
First Ozone Season Under the CSAPR Update Rule Begins Amid Uncertain Market Conditions
This month marks the official start of the 2017 ozone season. 22 eastern U.S. states will have to comply with much tighter emission budgets than over the last two ozone seasons. Emission budget reductions for CSAPR states, required by the EPA as part of the 2016 CSAPR Update Rule, have created very delicate market conditions […]
Structural changes over the past 12 months set to increase power burn by 0.75 – 1.00 BCFD over next year
The advent of low natural gas prices as a result of the shale revolution led to a major structural shift from coal to gas in the power markets. Based on EVA’s proprietary Power Plant Tracking Database, almost 47 GW of gas-fired capacity has been added till date starting 2012. Nearly 13 GW of new gas […]
New EPA under President Trump: Obama-Era Regulatory Rollbacks are in Full Swing
After last month’s issue of the long-awaited Executive Order (EO) on “Promoting Energy Independence” (see March Newsletter), the Environmental Protection Agency (EPA) headed by Administrator Scott Pruitt is in full force to undo some of the regulations supporting the “War on Coal.” As part of his EO issued last month, President Trump requested that the […]
Quick Trip: Despite increasing pipeline connections, Mexico emerges as the largest importer of U.S. LNG
As of late-April, Sabine Pass has exported more than 100 LNG cargoes to 17 different countries. Regionally, the shipments have been split almost equally between South American, Asian and Middle Eastern markets, fluctuating based on seasonal demand. Yet somewhat unexpectedly, the single largest importer of U.S. LNG is the country that would otherwise seem to […]
‘Tis the Season for Curtailment: Amid low seasonal demand, California tests the limits of renewable energy penetration
After suffering through several years of severe drought, California experienced record rainfall in late-2016 and early-2017, sufficient to fill previously depleted reservoirs. Simultaneously, the state brought on an additional 5.3 GW of solar capacity in 2016, bringing the total to 10.3 GW to go along with 5.7 GW of wind capacity. As a result, renewable […]
OPEC Cuts Production, but Change in Global Supply Muted
At the halfway point in OPEC’s six-month plan to reduce global supplies, the 11 participating OPEC members have reduced production 1.35 million barrels per day (MMBD) from Oct. levels. However, those production cuts have been partially offset by increases elsewhere in the world. This newsletter provides a granular assessment of these offsetting variances and addresses […]
Canadian Gas Imports: A Reversal in Trends
For the seven year period from 2008 to 2014 net Canadian exports to the U.S. were declining (i.e., 3.9 BCFD, or 43%). However, in 2015 and 2016 this trend was reversed. This newsletter examines both the underlying drivers behind this reversal in trends and the intermediate-term outlook for Canadian imports. Regional Assessment: Northeast Declines, While […]
RPS Compliance in PJM Markets: More flexibility than meets the eye
The PJM powerpool includes several states with sizeable Renewable Portfolio Standards (RPS). The standards—in MD, NJ, OH, PA, IL, DE and DC—require an escalating portion of retail sales be met through qualified renewable energy (RE) generation. Load serving entities in the PJM region comply with their relevant RPS obligations via Renewable Energy Credits (RECs), which […]
President Trump Issues Long-Awaited Executive Order on “Promoting Energy Independence”
On March 28, President Trump signed a highly anticipated Executive Order that will significantly impact future and existing environmental regulations. While media rumors regarding the content of the Executive Order were for the most part correct, the implications of this administrative action remain to be seen. President Trump’s “Executive Order on Promoting Energy Independence and […]
Natural Gas Markets Tighten Setting the Stage for a Price Surge
Arlington, Virginia – EVA has released its monthly forecast of the U.S. natural gas markets with related prices for March. The exceptionally mild 2016/2017 winter masked a relatively narrow supply and demand balance. The correspondingly lower winter prices has restrained—to a degree—upstream investment priming the market for serious tightness heading into the summer. However, the […]
Steady Summer Flows: Global price differentials tighten heading into summer, but not enough to shut-in Sabine Pass
Since beginning operations in February 2016, exports from Sabine Pass LNG on the Gulf Coast of Louisiana have flowed at high utilization rates. More than 100 cargoes have already been shipped from the terminal and besides a 3-week shutdown for scheduled maintenance in November, the project has operated at near full capacity. The high output […]
Equal Demand Reaction? Sagging U.S. gasoline demand may thwart OPEC’s efforts to balance markets
The key premise of OPEC’s plan to balance oil markets was that reduced production, combined with increasing global oil demand, would erode excess supply. While the supply cuts have proceeded largely as planned, global oil demand remains an outstanding question. Most demand expectations for 2017 were already rather modest, ranging around 1.1 MMBD, or 1.1% […]
EVA Special Report: Electric Vehicles Poised to Gain Increased U.S. Market Share
Arlington, Virginia – March 3, 2017. Energy Ventures Analysis (EVA) today published a report evaluating the future of electric vehicles (EVs) in the United States. The report, Outlook for Electric Vehicles in the U.S., reviews the current status of the EV market and evaluates the uncertainties surrounding the emerging technology and relevant regulations. In the […]
Unwavering Support: Congress and the new administration will likely seek to expedite U.S. LNG exports
Over the last several years, a general bi-partisan consensus had emerged in support of U.S. LNG exports. The Republican party has strongly advocated for exports and while staunch opposition persists among a small set of Democratic politicians, most followed the Obama administration’s position of offering tepid support—provided projects first complete a comprehensive permitting process. Under […]
No CPP, No Problem
To keep in line with the twists and turns of the fate of EPA’s Clean Power Plan, one of the highest-profile environmental regulations to come out of the Agency, which aims to reduce U.S. power sector CO2 emissions by more than 30% by 2030 below 2005 levels, the November 8 presidential election was no different. […]
A Record Year: 2016 solar capacity build reaches all-time highs
Final numbers from EIA prove what the solar industry had long suspected: 2016 was a record year for solar build in the United States. Driven by plummeting costs and strong policy support in key markets, 13.7 GW of new solar capacity was added in 2016, pushing total U.S capacity to 35.9 GW. The 13.7 […]
EVA Special Report: Second Wave of U.S. LNG Exports to Rival Magnitude of First Wave
Arlington, Virginia – February 14, 2017 Energy Ventures Analysis (EVA) today published a report analyzing the current status of U.S. LNG exports. The report goes beyond the increasingly well-understood first wave of U.S. LNG projects and evaluates the potential timing and magnitude of a second phase of projects likely to be sanctioned over the next […]
Environmental / Regulatory Affairs – What to expect in 2017
The turn of the year always allows time to reflect on what has transpired over the past year and what is to come during the next. This month’s newsletter provides a high-level overview of what to expect on the federal and state regulatory level affecting the domestic energy industry. Federal EPA Clean Power Plan (CPP) […]
Solar Down South: EIA AEO 2017 predicts enormous solar PV builds in the Southeast
The U.S. Energy Information Administration (EIA) recently released its Annual Energy Outlook for 2017 (AEO 2017), which provides projections through 2050. One of the more interesting results from this year’s release is the EIA’s reference case projection of an enormous increase in long-term solar PV capacity in the Southeast. Utility-scale solar PV capacity in […]
More Than a Headline? A closer look at non-binding HOA offtake contracts
Despite a strong consensus that the global LNG market is headed into a period of considerable oversupply, developers continue seek every opportunity to garner commercial momentum for their proposed LNG projects. Binding offtake contracts remain a necessity for new LNG projects. Given the scale of the investment and length of the construction timeline, proposed projects […]
EVA Special Report: Competition Between Renewables and Natural Gas Escalates
Arlington, Virginia – January 19, 2017 Energy Ventures Analysis (EVA) today published a report analyzing regional dynamics of near-term renewables and gas power capacity additions. The report focuses on a few critical states (Texas, California, Pennsylvania and New York) and evaluates the increasingly prevalent competition between gas and renewable energy (namely, wind and utility-scale solar […]
Monthly Short-Term Crude Oil and Petroleum Products Price Forecast
Monthly Short-Term Crude Oil and Petroleum Products Price Forecast Published December 29, 2016 Arlington, Virginia – December 29, 2016 – EVA Decodes OPEC’s Fuzzy Math and Finds Global Glut to Persist Through 2017. In EVA’s recently released Monthly Short-Term Crude Oil and Petroleum Products Price Forecast the OPEC plan for balancing global […]
Betting Big on Spot: Massive tenders from new importers push LNG spot market to new heights
In the past few months, two relatively new LNG buyers—Pakistan and Egypt—issued unprecedented tenders for short-term LNG supply. The deals, though not fully completed, reflect the convergence of two mutually-reinforcing trends: the rapid emergence of new importers and the heavy surplus of LNG set to hit the market in the next few years. In late […]
Expand and Extend: Multiple states double down on their RPS programs, but will obstacles emerge?
Renewable Portfolio Standards (RPS) now exist in 29 states plus the District of Columbia. Thus far, all states have been able to meet their rising targets, albeit by very different compliance mechanisms. The seeming success of the programs has driven the more recent trend of states extending and expanding their RPS objectives, measures that have […]
How the Trump Administration could change the Environmental Regulatory Landscape
On November 8, 2016, Republican presidential candidate Donald Trump achieved one of the biggest political surprises in the history of presidential elections. This month’s newsletter examines what short- and long-term impacts the incoming administration can have on the environmental regulatory landscape over the next four years. During the election, candidate Trump discussed repealing environmental laws […]
The Obvious but Critical Question: What happens to renewable energy under President Trump?
After eight years of steadfast support from the Obama administration, President-elect Trump and the Republican-led Congress appear eager to reduce or wholly eliminate various federal climate change efforts. This will negatively impact renewable energy development, but key support mechanisms will remain in place. Regardless, under the new administration, state-level incentives will emerge as the primary […]
Canadian Milestone: What the (apparent) success of Woodfibre LNG says about the current LNG market
In early November, Singapore-based Pacific Oil & Gas authorized financing for its 2.1 MMTPA (280 MMCFD) Woodfibre LNG project in Squamish, British Columbia. The announcement appeared to stop short of a full Final Investment Decision (FID), as it remains contingent on receipt of a few local and provincial approvals. While not guaranteed, those approvals are […]
EPA’s 2016 CSAPR Seasonal NOx Update Rule and its Effect on Coal Generation
On September 7, 2016 the EPA finalized an update to its Cross-State Air Pollution Rule (CSAPR) ozone season program. The CSAPR Update Rule adjusts state budgets to maintain the 2008 National Ambient Air Quality Standard (NAAQS) for Ozone (75 ppb). While state budgets have increased for most states from the proposed rule, some states and […]
The CPP Goes to Court: Update on the litigation of EPA’s Clean Power Plan
After months of anticipation, EPA’s Clean Power Plan (CPP) – one of the most watched environmental regulations coming out of Washington, DC – finally had its first day in court on September 27. This newsletter summarizes the Clean Power Plan and the legal issues at stake, previews the remaining schedule for the litigation, and highlights […]
New York’s Clean Energy Standard puts the state (back) at the forefront of fighting Climate Change
On August 1, 2016, New York’s Public Service Commission presented the Clean Energy Standard (CES). New York’s latest policy achievement to combat climate change will require 50% of the state’s 2030 electricity consumption to come from renewable energy sources and provide financial incentives to at-risk upstate nuclear power plants for their carbon-free electricity. The 50 […]
Trouble All Around: Results from the California Cap & Trade program’s latest auction hints at worrisome future
California’s cap-and-trade program, established under Assembly Bill 32 (AB 32) by then-Governor Arnold Schwarzenegger, which aims to reduce California’s GHG emissions to 1990 levels by 2020, is facing significant legal, political, and financial troubles. The latest cap-and-trade allowance auction held in May displays worrisome results. Of the almost 78 million allowances available in the auction, […]