Octopus Overlords

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https://www.cnbc.com/2022/06/14/natural ... osion.html

“The U.S. natural gas market will now be temporarily oversupplied as 2 bcf/d or a little over 2% of demand for U.S. natural gas has been abruptly eliminated,” said Rob Thummel, managing director at Tortoise Capital.

Crazy how everything is more and more expensive and then a disaster drops prices.

It's worth noting that the supply is due to low wind availability: https://www.ercot.com/ .

Yes, Virginia, there are windless days in West Texas.

I know that Texas' big selling point for business is their lack of regulations. But with global warming being a thing, the intentional isolation of their power grid and the probability that they never hardened their grid after the last time it shit the bed, why the hell would I want to move my business to Texas?

$iljanus wrote: ↑Mon Jul 11, 2022 10:11 pm I know that Texas' big selling point for business is their lack of regulations. But with global warming being a thing, the intentional isolation of their power grid and the probability that they never hardened their grid after the last time it shit the bed, why the hell would I want to move my business to Texas?

If you're selling diapers and baby formula?

The Texas GOP are incredibly immature, that’s true.

$iljanus wrote: ↑Mon Jul 11, 2022 10:11 pmI know that Texas' big selling point for business is their lack of regulations. But with global warming being a thing, the intentional isolation of their power grid and the probability that they never hardened their grid after the last time it shit the bed, why the hell would I want to move my business to Texas?

Lots of reasons.

In the past couple of years, states such as California and New York have seen the largest outflux of residents, fueled by employees’ ability to work from anywhere and their need to escape dense urban environments. Many companies chose to follow their employees and relocate their headquarters to more business-friendly states in order to reduce their overall costs and improve efficiencies, but also to pursue further growth by accessing the highly talented employment pool generated by local universities.

Commercial Property Executive identified five states that attracted some of the most notable corporate relocations since the onset of the health crisis. The opportunities in these states, coupled with their local support systems, are hard to match by other environments in the country. This is why commercial real estate experts expect these states to continue to attract even more corporate relocations and expansions going forward.

With its pro-business climate, access to talent, solid fundamentals and low tax rates, Texas has seen more corporate relocations since the onset of the pandemic than any other state in the country. Most of these moves were part of the exodus from Silicon Valley, generated by California’s high tax rates and unaffordable housing costs that have made living and doing business difficult within the state.

Austin became a highly sought-after destination for tech giants such as Tesla, which announced its relocation from Palo Alto, Calif., to the metro last year. Data center powerhouse Digital Realty and Oracle also moved to Austin from Redwood City, Calif., in the first year of the pandemic. Other notable names include venture firm 8VC and software company FileTrail, both relocating from San Jose, Calif., to Silicon Hills due to their rapid growth and need to accommodate their rapidly expanding teams. CrowdStreet also opened a second office and relocated its corporate headquarters from Portland, Ore., in 2021.

Of course, we'll have to see what fresh hell our legislature unleashes in the wake of Dobbs. But then again, if you're a company large enough to consider moving states for business environment, you can pick up out-of-state travel costs for medical procedures pretty easily.

Does all that still apply when they can’t even power it?

“Powered by Capitalism (TM)”

Yeah. That’s great and all, but it really doesn’t. And buildings, machines, and infrastructure truly are things businesses need in place.

/shrug.

And if America is about to be turned into Texas at the regulatory level, then Texas is going to look even more unattractive, I’d think.

No one will care until the oligarchs miss the target on their quarterly bonus. This stuff isn't even on that radar. A day or two outage that kills a couple hundred is an inconvenience to the system. Nothing more nothing less.

I get that y'all like to point at Texas as it's well worthy of ridicule, but let's not pretend that this is just a Texas problem. It takes two seconds of Google to see it's a nation wide power grid issue.

We are special in Texas because we are the only ones that told the rest of the country, no thanks, we'll go it on our own.

coopasonic wrote:We are special in Texas because we are the only ones that told the rest of the country, no thanks, we'll go it on our own.

Yes, and with roughly average results.

When you’re the only test subject, every result is average.

noxiousdog wrote: ↑Tue Jul 12, 2022 4:14 pm I get that y'all like to point at Texas as it's well worthy of ridicule, but let's not pretend that this is just a Texas problem. It takes two seconds of Google to see it's a nation wide power grid issue.

Unfortunately Google doesn't tell you that the problems are very different. MISO (the operator for the Midwest) for instance covers a huge area. It wasn't built for the whole mid-west to be 10-15 degrees above average at the same time. But that happens now.

Whereas the Texas problem is more about mismatched capacity, forced outages (poor maintenance), faulty power market, and sticking it to federal government.

Isgrimnur wrote: ↑Tue Jul 12, 2022 4:46 pm When you’re the only test subject, every result is average.

$iljanus wrote: ↑Mon Jul 11, 2022 10:11 pm I know that Texas' big selling point for business is their lack of regulations. But with global warming being a thing, the intentional isolation of their power grid and the probability that they never hardened their grid after the last time it shit the bed, why the hell would I want to move my business to Texas?

While both are a huge result of greed (Texas Power Grid issues AND Climate Change inaction), the first is fixable, but the second? Yeah, Dunno if you all saw that graphic of Texas Temps forecast, which also showed roughly half of New Mexico in flames, but that's going to be a huge issue in Texas, as well as Coastal/Houston area flooding. Those issues aren't as fixable withjust a bit more investment, like the grid and Heating/AC.

ND beat me to the punch, but yeah, the "Texas Power Grid Collapse" isn't real. It's one of the long running jokes of the forum, like Smoove pouring whiskey on his Cheerios or Chris Hemsworth calling hepcat for hair tips. (Patrick Dempsey locked hepcap into an exclusive retainership almost a decade ago.)

In real life, Texas is thoroughly average in the energy department - power is less reliable than it is in New York, but it is also much much cheaper. The Texas power grid certainly has challenges - but that's true of most of the country at the moment. California routinely leads the nation in terms of people without power - but nobody would claim that the California grid is "collapsing." Power grids are big, expensive, complicated things, and we're asking them to change very quickly on both the supply and demand fronts. There are going to be issues. But nobody is actually falling apart....at least, not yet. (Depending on how serious we are about achieving renewable energy goals, though....Hawaii may have some real problems.)

I guess it just gets etched into our consciousness when hundreds of people die due to a failure. And it's not just the failure of the grid, it's things like surprise multi-thousand dollar electricity bills.

Little Raven wrote: ↑Tue Jul 12, 2022 8:57 pm ND beat me to the punch, but yeah, the "Texas Power Grid Collapse" isn't real. It's one of the long running jokes of the forum, like Smoove pouring whiskey on his Cheerios or Chris Hemsworth calling hepcat for hair tips. (Patrick Dempsey locked hepcap into an exclusive retainership almost a decade ago.)

It is absolutely real. There are several assessments that talk about the problems in ERCOT. It is no means the only system with risks - NERC 2022 Summer Assessment but again it has unique risks. If you want to get nerdy, you can compare multiple years. I'll give you a hint which region have seen Elevated or High risk in similar reports for the last 10 years at least. Still it is absolutely true that several regions have problems. This year saw more western regions fall into Elevated or High risk vs. 2020/2021. They are generally totally different problems but don't let that impact any analysis.

Still only one has one that comes from a flawed decentralized market design that could totally be solved with some market restructuring. It is very different from the rest of the grids in the United States. There are different takes on solutions ( here is one) but the peel back is that there all sorts of problems with its incentives that impact its resilience in very real ways. For example, outages cause price spikes that act like a windfall profit lottery for operators that don't fail. If you don't run, it's shucks you didn't win the lottery but you also don't get fined for your failure like other grids do to drive maintenance investment. We now know enough that this lottery hasn't worked as an alternative mechanism that causes operators to focus on reliability.

That's a chief component why Texas has a history of a lot of forced outages. Which in layman's terms mean the plants went offline outside a planned maintenance window. In addition, power prices are only average there despite the heavy reliance on relatively cheap wind power. The price is only average if you aren't exposed to extreme prices (which happens without much backstop). Prices can spike to hundreds or thousands of dollars a day in extreme circumstances. Or it might be half the price of NY. The chief difference is in NY you'll never experience that financial risk at all.

In real life, Texas is thoroughly average in the energy department - power is less reliable than it is in New York, but it is also much much cheaper.

FWIW this is not an authoritative source used by anyone who works in the power industry or wants to understand power grid reliability. The metric they use for power grid reliability doesn't make any sense. Averaging outages across a region or state don't tell anyone much. When I worked in the industry we tracked actual customers who had outages, forced outages, uptime for power plants (which included allowances for planned maintenance outages), revenue + lost revenue, etc. This isn't a useful way to compare reliability because too much detail is getting chopped out that tells the real story.

In any case, new capacity is almost always solar + wind energy because it requires low cash outlays. Hot days + low wind are going to be continuing risk for the foreseeable future because no one wants to invest in 'big boiling water' generation at the moment. They require large cash outlays, multi-year projects with high risk, fuel prices all over the place, etc. Investors hate any mention of them.

Another thing to consider is that the markets are not all structured the same. While NYISO is one of the highest priced market in the nation, this is a choice driven for reliability. They heavily leverage "must run" contracts to reserve capacity that make power much, much more reliable than the Texas market. The local Independent System Operators also have incentives/contract structures that drive regular maintenance. This applies to PJM (Penn/NJ/Maryland). They also have interconnect agreements between systems which brings more reliability. More they've raised rates to make upgrades in anticipation of climate change with proactive upgrades. On top, both regions also tap into Canadian hydro markets. Texas in comparison whispers thoughts and prayers to the market fairy and hopes it works out.

The Texas power grid certainly has challenges - but that's true of most of the country at the moment. California routinely leads the nation in terms of people without power - but nobody would claim that the California grid is "collapsing."

It is at highest risk but it isn't uniform. The outages in California tend to be concentrated in PGE territory (which isn't all of California). Outside of PGE reliability is much higher. Another factor in California is that outages are often related to fire activity (though sometimes PGE starts the fires themselves. ) This results in long-term outages that leave places sometimes off the grid for weeks/months. Another reason the average outage per customer metric isn't that useful.

Power grids are big, expensive, complicated things, and we're asking them to change very quickly on both the supply and demand fronts. There are going to be issues. But nobody is actually falling apart....at least, not yet. (Depending on how serious we are about achieving renewable energy goals, though....Hawaii may have some real problems.)

It isn't about 'falling apart'. It is about systemic risks and Texas has taken on excess risk. Where are the outages elsewhere due to poor maintenance elsewhere in the nation that led to hundreds of deaths? Where do we see multiple generation assets failing simulataneously at peak load periods? Where did these problems cause catastrophic failures twice in a decade? Texas.

In any case, I started this thread because I worked in the industry. I was in the industry when this happened a decade ago. I wasn't in when it happened recently but I did have a conversation with folks that cold week at my former employer. And all of this was predicted. It's been long discussed (I posted multiple deep dives earlier in this thread). They still haven't made changes that address the root causes of their problems. They are however very real and very likely to get worse with climate change impacts.

Alefroth wrote: ↑Tue Jul 12, 2022 10:52 pmI guess it just gets etched into our consciousness when hundreds of people die due to a failure. And it's not just the failure of the grid, it's things like surprise multi-thousand dollar electricity bills.

I'll repeat it but I think people don't really know they had a major grid failure twice in 10 years. Both were "hundred year" failures. Except for the fact that experts predicted extreme weather failures were a risk before it happened. Also one of the economists who designed the market design says it doesn't work. But fuck experts amirite?

malchior wrote: ↑Tue Jul 12, 2022 11:18 pmBut fuck experts amirite?

I really just want my power grids planned and run by someone I can imagine having a beer with, y’know?

Is it just me, or does anyone else have this image in their head of malchior?



malchior, I feel like you've had a lot of jobs in a lot of different fields!

I didn't. ... But now I do.

Kurth wrote: ↑Wed Jul 13, 2022 10:15 ammalchior, I feel like you've had a lot of jobs in a lot of different fields!

I have! Except it was a lot of jobs in two jobs. That's strategic cybersecurity consulting for you. You often have to dive deep into a new business and learn how it works. But in this case it goes beyond - I spent about 10 years in non-utility power generation (aka independent power provider) and oil & gas. Lots of overlap there. And I can deep dive into this stuff because I really know how those businesses work.

I would sound every bit as smart as malchior if you wanted to have a conversation about technical implementations of auto loan risk assessment and valuations... except I wouldn't say anything because I really like my job and there is hardly anything interesting I could share that wouldn't be proprietary and likely get me fired.

Good luck resident TX folks:

As temperatures soar above 100 degrees, power plants have even been forced to skip regular maintenance to keep cranking out electricity. That's helped keep the power on for now. But this short-term focus is putting even more stress on a system that's already stretched to its limit. And without getting the service they need to remain safe and functional, folks are worried about a total collapse. "Things are going to break," Executive director of Texas Competitive Power Advocates Michele Richmond told the publication. "We have an aging fleet that's being run harder than it's ever been run."

Last week, fear of a power collapse caused the Electric Reliability Council of Texas (ERCOT) to initiate a rarely used emergency program that is triggered when supplies fall below a critical safety margin. The ERCOT, which operates the grid that serves more than 26 million customers, urged residents to cut power use during the hottest hours of the day and warned of a risk of rolling blackouts. People were asked to turn up [thermostats], defer the use of high-power appliances and turn off swimming pool pumps, according to Reuters.

Of note:

The power collapse notice came after ERCOT began paying suppliers an average of $5,000 per megawatt hour to keep generators running. That price is the highest the grid operator pays. The council blamed forced outages at coal- and natural gas-fed power plants, and low wind power generation for the emergency protocol. "They were pulling a lot of levers to avoid going into emergency operations and rolling blackouts," President of Consultants Stoic Energy LLC told the publication. A spokesperson declined to provide details on the number or type of offline generating plants.

Climate change has made Texas heat hotter and longer lasting. Over the last 125 years, the average daily minimum and maximum temperatures have increased by 2.2 degrees Fahrenheit. And the state just experienced its hottest December on record since 1889. Addressing the power crisis, Houston Mayor Sylvester Turner responded to ERCOT’s request with a tweet asking all city departments to prepare for the worst-case scenario.

weather app says...

Monday: 108
Tue: 110
Wed: 108
R:100
F:103
Sat:102
Sun:104
M:105
105
103

Gonna be a fun summer!

Oh and kids are back in school in 3 weeks. Cool (not really).

The answer is raise that cap of $5000/Mwh! Let the magic of markets solve this.

In all seriousness, I don't think the head in sands types get how dire the situation is there. I'm not saying they'll definitely have another outage but the risk is pretty high. Worse Texas has a problem with elevated risk across two seasons now. This is tough because the PM at a power plant isn't a couple of week affair. The routine stuff usually can't happen if you are running or on standby. Even if you have a couple of days off some work isn't possible in indefinite windows. And big jobs have extended shutdown periods. For example taking the whole turbine apart and inspecting it properly, etc.

Smoove_B wrote: ↑Mon Jul 18, 2022 3:11 pm Good luck resident TX folks:

As temperatures soar above 100 degrees, power plants have even been forced to skip regular maintenance to keep cranking out electricity. That's helped keep the power on for now. But this short-term focus is putting even more stress on a system that's already stretched to its limit. And without getting the service they need to remain safe and functional, folks are worried about a total collapse. "Things are going to break," Executive director of Texas Competitive Power Advocates Michele Richmond told the publication. "We have an aging fleet that's being run harder than it's ever been run."

Last week, fear of a power collapse caused the Electric Reliability Council of Texas (ERCOT) to initiate a rarely used emergency program that is triggered when supplies fall below a critical safety margin. The ERCOT, which operates the grid that serves more than 26 million customers, urged residents to cut power use during the hottest hours of the day and warned of a risk of rolling blackouts. People were asked to turn up [thermostats], defer the use of high-power appliances and turn off swimming pool pumps, according to Reuters.

Of note:

The power collapse notice came after ERCOT began paying suppliers an average of $5,000 per megawatt hour to keep generators running. That price is the highest the grid operator pays. The council blamed forced outages at coal- and natural gas-fed power plants, and low wind power generation for the emergency protocol. "They were pulling a lot of levers to avoid going into emergency operations and rolling blackouts," President of Consultants Stoic Energy LLC told the publication. A spokesperson declined to provide details on the number or type of offline generating plants.

Climate change has made Texas heat hotter and longer lasting. Over the last 125 years, the average daily minimum and maximum temperatures have increased by 2.2 degrees Fahrenheit. And the state just experienced its hottest December on record since 1889. Addressing the power crisis, Houston Mayor Sylvester Turner responded to ERCOT’s request with a tweet asking all city departments to prepare for the worst-case scenario.

I'm sure Texans will pull together and provide the conservation needed.

last week I raised the thermostat 3 degrees and was uncomfortable but ok, but that was really only possible because my wife was out of town. I lowered it back 2 of those 3 degrees a few hours before she got home. She is *very* sensitive to heat as she goes through second puberty.

I can't imagine being heat sensitive and living in a place where it's hot 3/4s of the year. I keep my house at 75 in the summer and that's too hot for me. When it's 85 plus out the AC is on waaaay too much just keeping my small house cool. However, since quitting my job, I'm in shorts all the time so I don't get home and sit in my underwear trying to keep cool at 75. I try to do my walks in the morning before it 70 when I can and I come home soaking wet with sweat. I overheat from 80-90 minutes of walking when it's a pleasant 55 outside.


108? Even in the dry heat? Fuck that shit, I'm out.

I really need to tool my basement for my day to day living and then set thermostat to 80 in the summer. Maybe these incremental energy price increases will finally see me do that.

Hey, Paris, Texas and Paris, France may hit the same temperature tomorrow.

PT forecast for 109, PF is 106.

British RAF grounded because...

... the runways are melting:

BREAKING NEWS: Flights in and out RAF Brize Norton in Oxfordshire have been halted because the "runway has melted" in the hot weather, Sky News understands.

LordMortis wrote: ↑Mon Jul 18, 2022 3:53 pm I can't imagine being heat sensitive and living in a place where it's hot 3/4s of the year. I keep my house at 75 in the summer and that's too hot for me. When it's 85 plus out the AC is on waaaay too much just keeping my small house cool. However, since quitting my job, I'm in shorts all the time so I don't get home and sit in my underwear trying to keep cool at 75. I try to do my walks in the morning before it 70 when I can and I come home soaking wet with sweat. I overheat from 80-90 minutes of walking when it's a pleasant 55 outside.


108? Even in the dry heat? Fuck that shit, I'm out.

I really need to tool my basement for my day to day living and then set thermostat to 80 in the summer. Maybe these incremental energy price increases will finally see me do that.

My nominal cutoff for walking is 75 degrees when I leave around 9 a.m. I'll fudge that to factor in humidity and cloudiness. This morning it was 77, but cloudy, but also humid. I decided to walk anyway and had to cut it short after working up a major sweat on Millionaire Mountain. I only completed 2.25 of my 3.1-mile route.

I don't use AC unless it's going to be over 90 for several days (as it will be this week). I don't like refrigerated air, and wrestling my AC unit in and out of the window is a pain. I haven't used my AC yet this year.

Wife, OTOH, turns her unit on as soon as I install it in May and runs it continuously until I uninstall it in October. She keeps it set at 64 (but her room never cools down that far because she keeps the door cracked for the cats).

We have an ongoing argument over buying a new house with central air. I don't want it because I like the windows open and fans going; she wants it running all summer. She says central air is mandatory and I say it's a deal-breaker. We'll have to find a house with separate wings that each have their own heating/cooling zones.

I'm with your wife. Central air is mandatory. Any house I live in must have central air and a garage. The next thing I'd want after that is an attached garage. If I could do it over again, it would be mandatory. The next thing is spacious, easier to clean bathroom. It's not mandatory but boy do I wish I had one. Central air is first and foremost and no central air is a deal breaker. I do not do heat well. I have to drive south to get to Canada for a reason. I'm either lucky I was born to this climate or I'd have to move to get to a place like here. Or I'd have assumed life was misery living somewhere south. Though I do also dislike biting humid windy winters where windchills get to be 30 below or worse. There will be no accommodating for weather on my walks then.

I don't tolerate the heat as well as I used to, but I still prefer it to cold. My winter walking guideline is that it must be at least 30 degrees, not precipitating, and the sidewalks must be free of snow and ice. I'll go as low as 25 degrees if it's sunny and calm and the ground is bare. That keeps me housebound for most of January into March.

I couldn't live in TX or anywhere in the South because I dislike AC. That said, our forecast calls for highs in the 90s from Tuesday through Saturday, so I'll wrestle my unit into the window tomorrow.

Get central air and close the vents for your areas.