FERC blocks Trump support for coal, nuclear plants
The US Federal Energy Regulatory Commission (FERC) today rejected a proposal backed by President Donald Trump that would have provided potentially billions of dollars to coal and nuclear power plants in support "grid resiliency."
US energy secretary Rick Perry released the plan in September out of concern that pending retirements of coal and nuclear plants posed an "urgent" threat to the resiliency of the grid. Those plants have been struggling to compete against low-priced natural gas and renewable energy, and Perry's plan would have helped them through subsidies.
But FERC said the proposal failed to show that existing power market rules in the US were unreasonable, a step the agency says is needed before it can force changes.
FERC specifically rejected the idea that only power plants with 90 days of on-site fuel should qualify for additional payments. FERC said the proposal did not show how providing payments would benefit the grid, or how excluding other resources would not be discriminatory. Other resources that do not have 90 days worth of fuel supply can also improve the reliability of the grid, FERC said.
Coal and nuclear groups had supported the proposal, which they said was needed to stave off a wave of retirements of baseload power plants that run constantly. But a coalition of natural gas groups, power plant owners and renewable energy companies rallied against the plan over concerns it would cause chaos across power markets.
The grid resiliency proposal would have cost between $800mn/yr and $3.8bn/yr, the consulting firm ICF said last year. The research firm Energy Innovation estimated the costs of the proposal could reach $11.8bn/yr, of which 30pc would go toward coal plants and 70pc would go toward nuclear plants.
FERC said it appreciated that Perry identified grid resilience as an "important issue that warrants further attention" and had decided to open a new proceeding into the issue. The order today asks the major electric grid operators dozens of questions about the largest issues they face with grid resiliency and the steps underway to address those issues.
Perry today reiterated his earlier arguments that an on-site fuel supply plays an important role in resilient and affordable electricity.
"As intended, my proposal initiated a national debate on the resiliency of our electric system," Perry said.
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US Gulf oil shut-ins drop as Helene nears landfall
US Gulf oil shut-ins drop as Helene nears landfall
New York, 26 September (Argus) — US Gulf of Mexico oil production shut-in levels fell today as Hurricane Helene bore down on Florida's west coast as a category 3 storm, bringing the threat of dangerous storm surge and winds. Around 441,923 b/d of US offshore oil output, or 25pc, was off line as of 12:30pm ET, according to the Bureau of Safety and Environmental Enforcement (BSEE). That is down from 29pc on Wednesday as the eastern Gulf path of the storm took it farther away from most offshore production facilities. About 363.39mn cf/d of natural gas production, or 20pc of the region's output, was also off line today, up from 17pc on Wednesday. Operators have evacuated workers from 27 offshore platforms. Helene was last about 145 miles west-southwest of Tampa, Florida, packing maximum winds of 120mph, according to a 4pm ET advisory from the US National Hurricane Center. Further intensification is likely and Helene could approach the coast at category 4 strength, with winds of at least 130mph. Landfall is expected near Port Leon on Apalachee Bay Thursday evening before Helene is forecast to turn northwestward and slow down over the Tennessee Valley on Friday and into the weekend. Earlier this week, offshore operators including BP, Equinor and Chevron took the precaution of suspending some operations and evacuating workers from offshore facilities in advance of the hurricane. Some facilities have since started back up as the hurricane's track shifted away from the main oil and gas hub in the region. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
New York picks WCI for carbon market platform
New York picks WCI for carbon market platform
New York, 26 September (Argus) — New York state will use the Western Climate Initiative (WCI) platform when administering its economy-wide carbon market, the latest sign that regulators in the state are looking to align program elements with systems in other North American carbon markets. Regulators from Quebec and New York announced the agreement on Wednesday at the International Emissions Trading Association's North American Climate Summit, an event on the sidelines of the UN General Assembly and Climate Week NYC. After a competitive process to select a platform for its market, New York state reached a deal this week to lean on the WCI for its "market registry platform, the auction platform, and financial services", New York State Department of Environmental Conservation deputy commissioner Jon Binder said. The WCI nonprofit provides the market infrastructure for California and Quebec's linked carbon market, as well as for a similar program in Washington state where regulators are weighing a potential linkage with the other two. Any eventual linkage with New York's program, which could see compliance obligations start in 2026, would be made easier by all the jurisdictions utilizing the same system for administering their respective programs. The decision does not "necessarily mean these programs are linking," but New York is "happy to keep those conversations going in that regard," Binder said. Nova Scotia, which wound down its cap-and-trade program last year, used the WCI platform for auctions without linking its programs with any other jurisdictions. "It doesn't mean that New York will link with us," said Jean-Yves Benoit, chair of the WCI board and the director general of carbon regulation and emissions data at Quebec's environment ministry. "Although I would be very happy if we issue a joint press release next year saying that." By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Hurricane Helene shuts in 29pc of US Gulf oil
Hurricane Helene shuts in 29pc of US Gulf oil
New York, 25 September (Argus) — Hurricane Helene, which is forecast to intensify as it heads for a late Thursday landfall in Florida, has shut in about 29pc of US Gulf of Mexico oil output. Around 511,000 b/d of US offshore oil output was off line as of 12:30pm ET, according to the Bureau of Safety and Environmental Enforcement (BSEE), while 313mn cf/d of natural gas production, or 17pc of the region's output, was also off line. Operators have so far evacuated workers from 17 offshore platforms. Helene was last about 110 miles north-northeast of Cozumel, Mexico, according to a 2pm ET advisory from the US National Hurricane Center, with maximum sustained winds of 80 mph. Helene is expected to be a major hurricane, with winds of at least 111mph, when it reaches the eastern Florida coast on Thursday evening. "A turn toward the north and north-northeast with an increase in forward speed is expected later today through Thursday, bringing the center of Helene across the eastern Gulf of Mexico and to the Florida Big Bend coast by Thursday evening," the center said. Shell restarting some production Although the hurricane will largely pass to the east of most offshore oil and gas production areas, companies have taken precautionary measures. Given a shift in the forecast track, Shell said late Tuesday that it had started to ramp up production at the Appomattox platform to normal levels, and was in the process of restoring output at the Stones facility, both off the coast of Louisiana. It paused some drilling operations. Chevron said earlier it was shutting in production at company-operated facilities in the Gulf of Mexico, and evacuating all workers. Equinor said it was shutting down the Titan oil platform. BP had earlier this week started to shut in production at its Na Kika and Thunder Horse platforms, southeast of New Orleans, and was curtailing output from its Argos and Atlantis facilities, as well as removing non-essential staff. US offshore production was disrupted earlier this month when Hurricane Francine made landfall, with up to 42pc of production was offline at one point. The offshore Gulf of Mexico accounts for around 15pc of total US crude output and 5pc of US natural gas production. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
LNG glut coming and may catch many by surprise: Orsted
LNG glut coming and may catch many by surprise: Orsted
London, 25 September (Argus) — There will be an oversupply of LNG on the global market in the coming years, which may contribute further to "the decade of turmoil", Danish utility Orsted senior vice-president Rune Sonne Bundgaard-Jorgensen told Argus . "The [energy] crisis is absolutely not over. To me, an energy crisis is one of uncertainty and volatility," Bundgaard-Jorgensen said on the sidelines of the Energy Trading Week conference in London. "We are going to see an LNG glut which we all in this [conference] room see is coming but the rest of the world does not necessarily. That is going to catch a lot of people by surprise," he said, adding that "surprises are never good when it comes to energy". According to Bundgaard-Jorgensen, "we are going to see an ongoing decade of turmoil. Who knows where the war in the Middle East with the latest attacks on Hezbollah and Israel is going to take us," he said. Among other concerns, he mentioned "uncertainties in the Far East, around the South China Sea". "So, though the current energy crisis of decoupling from Russian pipe gas is over, the continued crisis of where we are going to get sustainable, long-term energy from is far from over," Bundgaard-Jorgensen said. Commenting on Orsted's long-term gas plans, Bundgaard-Jorgensen stressed that Orsted is "constantly evaluating" its gas portfolio. He refused to say whether Orsted is negotiating another long-term deal with Norwegian state-controlled Equinor after their previous contract expired in April. Orsted entered an agreement with Equinor at the end of 2022, after Russian state-controlled Gazprom halted deliveries to the firm from June 2022 following Orsted's refusal to pay for its supply in roubles . "We are quite happy that we are out of our long-term contract with Gazprom," Bundgaard-Jorgensen said. "As a company we believe in decarbonisation — but I also need to believe in a resilient portfolio. So, we are constantly looking to optimise. Gas is not a strategic core of Orsted but it is a very important tool of securing our portfolio," he said. Bundgaard-Jorgensen refused to comment on whether the firm is planning to appeal a decision made by the Danish Supply Authority in July that the tariff levied by Orsted on the Tyra-Nybro pipeline to Denmark from 2011 to October 2012 was too high. The authority reduced the tariff in the period by almost 30pc to 7.20 Danish kroner/m³ from DKr10/m³. By Alexandra Vladimirova Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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