A Critical Review of Energy• Energy Challenges: not limited to fuel price, but ―risk...
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A Critical Review of Energy Markets: Where We’ve Been and Where We’re Going 2010 Citizens Energy Group Energy Conference Plan September 14, 2010
Transcript of A Critical Review of Energy• Energy Challenges: not limited to fuel price, but ―risk...
A Critical Review of Energy Markets: Where We’ve Been and Where We’re Going
2010 Citizens Energy Group
Energy Conference Plan
September 14, 2010
Message
• Where we’ve been does not appear to be where
we’re going
• No roadmap (currently) exists
• Many conflicting/competing mandates
• Must look beyond short-term/narrow focus, or path
forward will produce costly, unsustainable outcomes
Competing Challenges
• Regulated or Competitive Market
• Domestic v. International
• State of Industry
• Compliance Requirements
• Investment/O&M Cost Impacts on Environment
• Private v. Public Company
• National v. International Footprint
• Shareholder Resolutions (SOX)
• On-Site v. Purchased Energy
• Clean Air Act; CAIR; CAMR; MACT; NAAQS
• Greenhouse Gases (GHG)
• Water Quality/Supply
• Byproduct BTUs?
• Fuel Price—Fixed, Spot
• Fuel Supply/Delivery Infrastructure
• On-Site v. Purchased Energy
• Carbon-Intensity
• % Product Cost
• Energy Efficiency—Demand Response, Smart Meters
Energy Environment
MarketEconomics
Energy History, EIA Outlook
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Source: J. Conti, 2010 Annual Energy Outlook (EIA).
Energy Price Trends and Factors
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Source: FERC, Energy Market Snapshot (September 2010)
Environmental and Clean Energy
Drivers
Why Energy Alternatives?
Energy Alternatives, Multiple Benefits
• Reduced/Avoided Emissions CAIR, CAMR, NAAQS. No GHG liability.
• RPS Avoid EU cost pass-through; revenue via REC sales.
• Facilitate Economic Growth Local, Business.
• Reduce/Eliminate Waste Disposal, Truck HaulingTipping fee = revenue.
• Reduce T&D Load/Cost (Distributed Generation).
Not All
Resources
Equal
Energy Supply Risks & Costs
• Need: service provided by ―BTUs‖ not fuel.
– What is least expensive, most reliable/sustainable? Lowest impact means?
• Energy Challenges: not limited to fuel price, but ―risk factors‖—
supply security, deliverable reliability, environmental impacts/cost
adders Supply Chain (LCA)
• Energy Efficiency: ―avoided‖ Energy Supply…but also ―avoided‖
Energy Delivery and Environmental Impacts
– ―Avoided‖ effects cannot always be ―monetized‖ societal benefits
What to Keep on Radar Screen
Factors Driving Path Forward• Power Sector
– Coal, NG, Nuclear, Renewables
– Clean Air, Climate Change Regulations
– Central v. Distributed Generation
– T&D Infrastructure, Smart Grid
– Demand Response
• Industrial Sector
– Coal, NG, Renewables,
– Self-Generation, Resell/Purchase
– Efficiency Improvements
– Clean Air, Climate Change Regulations
– Shut-down/Relocation
• Transportation Sector
– Liquid v. Electricity v. NG…Conventional v. Renewable?
– Clean Air, Climate Change
– Technological Innovation
Conclusion: Competing Challenges
• Regulated or Competitive Market
• Domestic v. International
• State of Industry
• Compliance Requirements
• Investment/O&M Cost Impacts on Environment
• Private v. Public Company
• National v. International Footprint
• Shareholder Resolutions (SOX)
• On-Site v. Purchased Energy
• Clean Air Act; CAIR; CAMR; MACT; NAAQS
• Greenhouse Gases (GHG)
• Water Quality/Supply
• Byproduct BTUs?
• Fuel Price—Fixed, Spot
• Fuel Supply/Delivery Infrastructure
• On-Site v. Purchased Energy
• Carbon-Intensity
• % Product Cost
• Energy Efficiency—Demand Response, Smart Meters
Energy Environment
MarketEconomics
Conclusion
• Where we’ve been does not appear to be where
we’re going
• No roadmap (currently) exists
• Many conflicting/competing mandates
• Must look beyond short-term/narrow focus, or path
forward will produce costly, unsustainable outcomes
David W. South
President
Technology & Market Solutions, LLC452 Brownstone Dr.
St. Charles, Il 60174
CP: 703.795.2274
