Friday, September 10, 2021

Energy 153, High natgas and coal prices

I am reposting these news reports, how the world, Europe especially, cannot really get out of fossil fuel dependence despite all the political pronouncements. Meanwhile, prices as of this writing.

Russia’s Nord Stream 2 pipeline to Germany nears completion as natural gas trades at all-time highs

By Joe Wallace and James Marson   Aug. 25, 2021 7:41 am ET
https://www.wsj.com/articles/gas-shortage-boosts-russias-sway-over-europes-energy-markets-11629891705 

Europe is facing a natural-gas shortage just as Russia is completing a controversial pipeline to Germany, increasing President Vladimir Putin’s leverage over the continent’s energy flows...

Russia, Europe’s biggest gas supplier, has declined to book big additional flows through pipelines in Ukraine, which are running below full capacity.

Claim: As the world battles to slash carbon emissions, Australia considers paying dirty coal stations to stay open longer 
Tim Nelson, Griffith University and Joel Gilmore, Griffith University
August 29, 2021
https://wattsupwiththat.com/2021/08/29/as-the-world-battles-to-slash-carbon-emissions-australia-considers-paying-dirty-coal-stations-to-stay-open-longer/

The Energy Security Board (ESB) provides advice to the nation’s energy ministers and comprises the heads of Australia’s major energy governing bodies. 

Advice to the ministers on the electricity market redesign, released on Thursday, includes a recommendation for a mechanism formally known as the Physical Retailer Reliability Obligation (PRRO).

Britain forced to fire up coal plant amid record power prices and winter squeeze
Two coal facilities taken off standby as the amount of electricity coming from wind farms falls dramatically
By Rachel Millard and Olivia Rudgard, 6 September 2021 • 8:14pm
https://www.telegraph.co.uk/business/2021/09/06/britain-forced-fire-coal-plant-amid-record-power-prices/

The UK has turned to a coal-fired power station to help boost its energy supply after global gas and power prices hit new highs and wind farms produced very low levels of electricity.

National Grid ESO, which balances Britain’s electricity supply and demand, asked EDF to fire up two units at its West Burton A power station in Lincolnshire. They had previously been on standby.

Europe’s High Energy Prices Are Just The Beginning
By Julianne Geiger - Sep 06, 2021, 3:30 PM CDT
https://oilprice.com/Latest-Energy-News/World-News/Europes-High-Energy-Prices-Are-Just-The-Beginning.html

And if Europe is still hoping that its own fossil fuels would prevent a winter price crunch for power, it would be wrong. According to Bloomberg, several production outages and declining gas fields have helped to send natural gas prices trading at a premium to crude oil.
Some estimates see retail consumers paying 20% more for utility bills.

Coal price surge gives Australia a new hope against China 
China’s tough crackdown has brought Australia’s $149 billion iron ore industry to its knees – but hope has come in a new form.
Alex Turner-Cohen    September 8, 2021 - 4:34PM 
https://www.news.com.au/finance/markets/world-markets/coal-price-surge-gives-australia-a-new-hope-against-china/news-story/f4648c82731cbe8e232302e763ad7071

When markets closed on Monday, metallurgical or coking coal was selling for $274 a tonne, very near the all-time high of $299.33 a tonne in November 2016.
The $274 cost was below its close last Friday which was the highest price for coal since April 2017.
In the past year, coal has been up 170 per cent.

California's Top Grid Operator Asks Feds To Burn More Fossil Fuels To Avert Blackouts 
BY TYLER DURDEN   THURSDAY, SEP 09, 2021 - 09:00 PM 
https://www.zerohedge.com/weather/californias-top-grid-operator-asks-feds-burn-more-fossil-fuels-avert-blackouts

CAISO wants the DoE to suspend air-pollution rules so it can use natural gas turbines as "back-up power generation and freeing up additional energy capacity to help alleviate electric demand on the electricity grid."

California declares energy emergency, seeks to avert blackouts by burning more fossil fuels 
9 September 2021 
https://www.bloomberg.com/news/articles/2021-09-09/california-seeks-to-avert-blackouts-by-burning-more-fossil-fuels

Furious Europeans Protest Electricity Hyperinflation: Lagarde Are You Watching?
BY TYLER DURDEN   THURSDAY, SEP 09, 2021 - 10:25 AM https://www.zerohedge.com/markets/furious-europeans-protest-electricity-hyperinflation-christine-lagarde-are-you-watching

...Take Spain, with one-day ahead power prices at €152.32 per MWh... one-day ahead electricity prices in the UK just going hyperbolic... "power prices are now front-page story in Spain. A huge political problem."

Ireland freezes power exports to UK as energy costs rocket tenfold 
10 September 2021 
https://www.telegraph.co.uk/business/2021/09/09/ireland-freezes-power-exports-uk-energy-costs-rocket-tenfold/

A toxic combination of low wind speeds and a severe squeeze on the supply of natural gas sent power costs jumping tenfold on the British mainland on Thursday to as much as £2,300 per megawatt-hour, a new record high.

Claim: Australia can Live the Renewable Energy Dream – All We Need is a Trillion Dollars of Government Loans
Eric Worrall  September 8, 2021
https://wattsupwiththat.com/2021/09/07/claim-australia-can-live-the-renewable-energy-dream-all-we-need-is-a-trillion-dollars-of-government-loans/

The biggest issue which jumps out at me, the expenditure Saul proposes is not a one off. If everyone continues to replace their appliances every 10 years, we’re talking about an additional $1 trillion or $100,000 per household which will have to be part financed by additional government soft loans every 10 years.

Natural gas prices are rising and could be the most expensive in 13 years this winter 
Patti Domm   SEP 9 20213:59 PM EDT
https://www.cnbc.com/2021/09/09/natural-gas-prices-are-rising-and-could-be-the-most-expensive-in-13-years-this-winter.html

In the futures market, the natural gas contract for October rose above $5 per one million British thermal units, or mmBtus, for the first time since February, 2014. Besides electricity and heating demand, natural gas is an important feed stock and is used in the processing of chemicals, fertilizers, paper and glass, among other products.

China coal-fired power companies on the verge of bankruptcy petition Beijing to raise electricity prices 
The Beijing Electric Power Industry Association has asked authorities for permission to raise electricity rates as coal prices skyrocket
Petition follows a letter last month from 11 coal-fired power companies within the Beijing-Tianjin-Tangshan power grid asking for relief
Luna Sun   5:30pm, 10 Sep, 2021 
https://www.scmp.com/economy/china-economy/article/3148291/china-coal-fired-power-companies-verge-bankruptcy-petition

Supply shortages have driven up coal prices in China and coal-fired power stations can only raise rates to accommodate increasing operational costs by as much as 10 per cent, with a large part of electricity prices fixed by the government.

But last year, the National Development and Reform Commission, the country’s top economic planning agency, prohibited all rate rises.
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See also:
Energy 150, Funny California oil importation policy, July 29, 2021 
Energy 151, Coal at $160/ton, electricity price spikes in Europe, August 07, 2021 
Energy 152, BWorld Insights on RE and Nuclear; Global news on renewed coal, gas demand, August 26, 2021.

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