On June 15th, FERC Office of Electric Reliability and Office of Enforcement issued its Summer 2017 Energy Market and Reliability Assessment. A copy of the report can be found here.
Here are a few takeaways from the report:
- Capacity levels are expected to be adequate this summer. Load forecasts and generation forecasts are essentially on par, with large amounts of new renewable resources offsetting the 4 GW of coal-fired and 6 GW of natural gas-fired plants that have been retired. The narrowest reserve margins are in ISO New England (15%) and ERCOT (15%) but each is still at or above its reference margin level.
- The National Oceanic Atmospheric Administration (NOAA) forecast above normal conditions this summer in the U.S., with the North Atlantic, Southeast and Gulf of Mexico regions holding the strongest possibility for a hot summer.
- Natural gas prices have risen year over year, and a year in which natural gas generation exceeded coal-fired generation for the first time (2016). Both coal and natural gas prices have risen from their recent five-year lows, and summer 2017 futures contracts of natural gas were trading at a $0.43/MMBtu premium to coal. Natural gas futures continue to rise, ranging from a $0.38/MMBtu to $0.88/MMBtu regional increase from the prior summer.
- Overall summer power futures have increased in the range of 9-11 percent, with the sole exception being the PJM Western hub, which has decreased 3 percent.
- FERC continues to monitor changes and impacts resulting from increased demand response, the Aliso Canyon, and the upcoming August 21 solar eclipse.