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New York’s Energy Challenges 2010

New York’s Energy Challenges 2010. Gordon Boyd, EnergyNext, Inc. For Municipal Electric and Gas AllianceSM www.megaenergy.org April 16, 2010. Good News and Bad News. Historic low energy prices…today. Regional differentials penalize consumers Cap and Trade: upside for NY.

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New York’s Energy Challenges 2010

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  1. New York’s Energy Challenges 2010 Gordon Boyd, EnergyNext, Inc. For Municipal Electric and Gas AllianceSM www.megaenergy.org April 16, 2010

  2. Good News and Bad News • Historic low energy prices…today. • Regional differentials penalize consumers • Cap and Trade: upside for NY. • Energy infrastructure agenda. • Energy market trends. • Consumers have the responsibility to choose. Energy Priorities 2010

  3. Why are prices low? • Demand destruction: The Great Recession (Bad news) • Speculators out of market (Good news) • Natural gas supplies are up. Unconventional, shale gas. (Good news) Energy Priorities 2010

  4. Wholesale Power Prices at Historic Low in 2009 (NYISO) Load Av.Electric Av.NatGas GWh $/MWh $/MMBtu 2000 428 $58.26 $5.52 2001 430 $51.22 $4.54 2002 435 $49.90 $3.85 2003 433 $62.58 $6.48 2004 438 $62.80 $6.80 2005 458 $93.83 $10.01 2006 444 $76.45 $7.36 2007 458 $80.29 $8.50 2008 452 $95.31 $10.13 2009 435 $48.63 $4.87 Energy Priorities 2010

  5. Wholesale Electricity Price Trend 2000-2009 (Average, NYS) Energy Priorities 2010

  6. Wholesale Natural Gas Price Trends 2000-2009 (Average, NYS) Energy Priorities 2010

  7. Total Electric DemandNYS 2000-2009 Energy Priorities 2010

  8. NYMEX Natural Gas Prices

  9. Natural gas storage trend, last 24 months (USEIA) ((CAUSE)) Energy Priorities 2010

  10. Another form of NGas storage ((Cause)) Energy Priorities 2010

  11. Growth of Unconventional NGas((Cause)) Energy Priorities 2010

  12. US shale activity picks up(www.rigzone.com) Index to 100 Jan08 Energy Priorities 2010

  13. Electric fixed price trend 4/15/2010 ((Effect)) Energy Priorities 2010

  14. January 3, 2010, 1 p.m. Energy Priorities 2010

  15. January 6, 2010, 9 a.m. Energy Priorities 2010

  16. Upstate NY Pricing Factors • Transmission congestion, East-West • Supply: Adequacy of nearby generation • Demand: Stability, growth or decline Energy Priorities 2010

  17. 3 Congestion Points Projected cost: 2009 - 2018 • Leeds-Pleasant Valley Zones F-G: • $1,307,000,000 • Mohawk Valley Zones E-F • $567,000,000 • West-Central Zones B-C • $230,000,000 Energy Priorities 2010

  18. Historic Cost of Congestion (NYISO) • 2004: $833,000,000 • 2008: $2,613,000,000 • 2009 (1Q): $233,000,000 Energy Priorities 2010

  19. Recent projects November 2009 • Linden transmission, GE developer, 300 MW between PJM and NYISO • Dover, 1,000 MW nat gas. Advance Power AG • 345KV underwater connection Bayonne, NJ to Gowanus-Brooklyn • Stephentown 20MW flywheel, Beacon Power. “Smart Grid Tech.” Energy Priorities 2010

  20. 2,000 Megawatts Under water, underground 355 miles to NYC/NE Hydropower and wind sources Outside existing energy routes Champlain-Hudson Power Express Energy Priorities 2010

  21. Cap and Trade: Impact on New York ratepayers • Carbon tax will raise price of coal-fired generation. • Other states are more dependent on coal than New York. • Electric prices will normalize. Energy Priorities 2010

  22. New York vs U.S. • New York State 15.27 cents/kwh • U.S. average 8.90 cents/kwh Energy Priorities 2010

  23. Pennsylvania Electric generation fuel mix, Nov. 2009 Energy Priorities 2010

  24. Ohio Electric generation fuel mix Nov. 2009 Energy Priorities 2010

  25. NY State Electric generation by fuel source Nov. 2009 Energy Priorities 2010

  26. New York wind resources Energy Priorities 2010

  27. Renewables by 2015 (NYS Energy Plan) Wind (1,280MW as of 2009): • On shore 7,993 MW • Off shore 534 MW Solar PV: 100 MW (14.6MW as of 2006) Total NYS peak electric demand 2008: +/- 38,720 MW (USEIA) Energy Priorities 2010

  28. Wind Power Challenges • Balancing, storage and ramping • Need for energy storage technologies • Coordination among regional grid operators to manage variable flow Energy Priorities 2010

  29. Private Investment in renewables Energy price hedge • On-site, behind the meter, PPAs • Bi-lateral deals between consumers and developers Green marketing • Renewable Energy Credits (RECs) Energy Priorities 2010

  30. …What’s next? NYS Energy Plan encourages • New capacity, both Generation and Transmission. • Fuel diversity, especially renewables. • Clear signals to consumers from energy markets to induce efficiency. Energy Priorities 2010

  31. Other policy initiatives under way • Smart metering – Installations began 2008. • Net metering – Customer sited generation banking. • Article 10 - One-stop permitting expired 2002. Is renewed effort in store? • Federal ARRA funding, block grants Energy Priorities 2010

  32. Consumer Choices and Responsibilities • Shop for energy supplies, price, rate, tax savings. Pay less. • Energy efficiency, SCR, NYSERDA programs. Use less. • Federal incentives, tax credits for efficiency and renewables Energy Priorities 2010

  33. QUESTIONS? www.megaenergy.org Energy Priorities 2010

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