EnerKnol Pulse is the newsletter that helps you keep track of the vast and ever-changing North American energy landscape, made possible by the EnerKnol platform.

January 29, 2018


Featured Topics

Fossil Fuels

Renewable Policies and Projects

Grid and Power Markets


Featured Entities

AGL Resources

Ameren Illinois

Avista

Commonwealth Edison

Dominion

Eversource

Exelon

Hydro One

LS Power Development

MidAmerican Energy

New Jersey Resources

PG&E

SCANA

SCE

SDG&E

SolarWorld

South Carolina Electric & Gas

South Jersey Industries

Spectra Energy Partners

Suniva

UGI Energy Services

Top News

Eversource's $1.6 Billion Northern Pass Power Line Emerges as Sole Victor in Massachusetts Renewable Buy

Governor Charlie Baker announced that Eversource Energy’s Northern Pass transmission line was the single project selected under a state program to boost Massachusetts’s supply of renewable energy to meet climate goals and move away from a growing reliance on natural gas-fired generation. Under the proposal the Northern Pass line will ship enough hydro power from Hydro-Quebec’s dams in Canada to meet 17 percent of the state’s electricity demand for up to 20 years, ramping up the commonwealth’s supply of “clean energy” to nearly 50 percent. New England generators opposed the plan, arguing that the influx of subsidized power puts them at an unfair advantage that could lead existing plants to close.

Connecticut Regulators Back Subsidies for Dominion's Millstone Reactor Even as Plant Seen Profitable for Decades

Connecticut’s top regulators endorsed a proposal for the state to lock into contracts to buy electricity from Dominion Energy Inc.’s 2,100-megawatt Millstone nuclear plant in view of the critical role the generator plays in supporting the reliability, fuel security and climate targets of New England. While under some scenarios the plant’s financial viability “could be at risk,” the reactor is likely to be profitable through 2035, according to a Jan. 22 report by the Connecticut Department of Energy and Environmental Protection and the Connecticut Public Utilities Regulatory Authority. Dominion is just the latest of several nuclear operators pushing for out-of-market support from states as competition from cheap gas-fired plants squeezes profits.

Avista, Hydro One's $5.3 Billion Merger Approved by Federal Energy Regulator as Canadian Buying Spree Continues

The Federal Energy Regulatory Commission on Jan. 16 authorized the merger of Hydro One Limited, a Canadian transmission and distribution service provider based in Toronto, with Avista Corporation, an electricity and gas utility serving Alaska, Washington, Idaho, Oregon and Montana. The deal still requires approvals from state regulators within Avista’s territory. U.S. energy companies, such as Avista, have proven to be an attractive target for their Canadian counterparts who have been active in scoring deals south of the border in a bid to boost growth.

Illinois Commission Approves $3.5 Billion Sale of Emissions Credits, Advancing Lifeline for Exelon's Struggling Reactors

The Illinois Commerce Commission on Jan. 25 approved the sale of zero-emission credits from three of Exelon Corp.’s nuclear plants to Ameren Illinois Co., Commonwealth Edison Co. and MidAmerican Energy Co. The procurement of the credits is geared toward propping up Exelon’s Quad Cities and Clinton nuclear reactors, and follows legislation signed into law in December 2016, known as the Future Energy Jobs Act. The procurement run by the Illinois Power Agency sold its target of 20,118,672 credits, at a value of $3.583 billion for the contracts that run from June 2017 through May 2027. Nuclear operators have increasingly turned to state handouts to remain in operation in the face of slumping power prices and tepid demand.

Fossil Fuels

PennEast Wins U.S. Approval for $1.13 Billion Natural Gas Pipeline, as Commission Split Over Need for Project

The Federal Energy Regulatory Commission voted 4 to 1 to approve the PennEast natural gas pipeline, as a majority of the agency’s members found there’s sufficient demand for the project to warrant the use of eminent domain. Commissioner Richard Glick, a Democrat, dissented, arguing that there is “limited evidence” of need, as more than 75 percent of the purchased capacity is from affiliates of the developers. The 116-mile pipeline is designed to ship 1,107,000 dekatherms per day of natural gas from Pennsylvania into New Jersey. PennEast is a joint venture owned by AGL Resources Inc., New Jersey Resources, South Jersey Industries, UGI Energy Services, and Spectra Energy Partners LP. Opposition to pipelines has hardened as plummeting prices for renewables like wind and solar have made a shift away from fossil fuels more viable.

U.S. Poised to Add 20 Gigawatts of Gas Fired Generation This Year, Marking Largest Boost in Over a Decade: EIA

Natural gas will continue to surpass coal as the nation’s primary source of electricity for at least the next two years, accounting for 34 percent of electricity in 2019 compared to coal’s share of 28 percent, according to a Jan. 22 report from the U.S. Energy Information Administration. More plants are burning natural gas as the average cost is projected to slip 2 percent this year, while coal will rise 5 percent. Advanced drilling techniques have opened a flood of gas supplies, sending prices to historic lows and positioning the nation to become a major exporter.

Virginia Lawmaker Proposes 100 Percent Renewable Goal, Fossil Fuel Ban

Virginia House Democrat Sam Rasoul introduced legislation requiring utilities to source all of their electricity from “clean energy” by 2035, from the current requirement of 15 percent by 2025. The bill would also impose a moratorium beginning next year on new fossil fuel-fired power plants, liquefied natural gas import-export terminals, and pipelines. The proposal comes as the state has begun a shift away from fossil fuels, enacting 11 bills just last year to expand renewables and energy efficiency. (HB 1490)

SCANA Seeks to Buy Georgia Natural Gas Plant to Replace Supplies Lost from Failed Reactor Project

South Carolina Electric & Gas, a subsidiary of SCANA Corp, requested approval from the Federal Energy Regulatory Commission to acquire the Columbia Energy Center, a combined cycle natural gas plant in central South Carolina owned by LS Power Development LLC, according to a Jan. 22 application. The acquisition comes after the utility scrapped plans to build two reactors at the V.C. Summer Nuclear Station. States across the country are turning to cheap, low-emitting gas-fired plants to replace generating capacity lost from the closure or existing nuclear plants, or in this case, when a project has been cancelled.

U.S. Interior Department to Offer 80,000 Acres in Wyoming Districts for Third Quarter Oil, Gas Lease Sale

The Bureau of Land Management on Jan. 23 issued its initial environmental analysis of proposed oil and gas lease sales in the third quarter for about 29,627 acres within the Wind River/Bighorn Basin District and 50,524 acres within the High Plains District. The bureau will accept public comments on the draft analysis through Feb. 21.

Dominion Cleared by U.S. to Upgrade Pipeline Serving Its Cove Point Gas Export Plant

A subsidiary of Dominion Resources Inc. was approved by the Federal Energy Regulatory Commission to construct and operate its Eastern Market Access Project, adding new compressors and expand existing ones to provide up to 294,000 dekatherms per day of capacity to a pipeline serving the Cove Point liquefied natural gas export facility in Lusby, Maryland. The project will be used by shippers Washington Gas Light Company and Mattawoman Energy LLC. The Cove Point LNG plant is slated to begin commercial operations early next year, according to a company announcement.

Renewable Policies and Projects

Trump Administration Imposes 30 Percent Tariff on Solar Imports in Move Seen Putting U.S. Jobs at Risk

The White House slapped tariffs on imported solar modules and photovoltaic cells starting at 30 percent and declining in 5-percent increments over three years, according to a Jan. 22 press release from the Office of the U.S. Trade Representative. Since 2012, imports of the parts have soared about 500 percent, causing prices to slump and spurring a challenge from bankrupt solar manufacturers Suniva and SolarWorld. The Solar Energy Industries Association, an advocate for developers, said the tariff puts 23,000 jobs at risk this year and jeopardizes billions of dollars of investments.

Wind Generation to Become Largest Source of Renewable Energy as Hydropower Projects Slow to a Trickle: EIA

The nation’s wind generating capacity is projected to grow 9 percent by the end of the year, or by 8.3 gigawatts, putting it on pace to topple hydropower, the historic leading renewable energy provider, for the first time. Hydropower’s share is expected to drop amid lower precipitation and as few new hydro plants will start over the next two years, according to a Jan. 24 report from the U.S. Energy Information Administration.

Maine Governor Bans New Wind Turbines Citing Threat to $6-Billion Tourism Industry

Maine Governor Paul LePage issued an executive order on Jan. 24 that imposes a moratorium on new wind turbines over concerns that the tourism industry, an economic engine for the state, could be adversely impacted. The prohibition will remain in place until a newly formed advisory commission completes a study on the economic impact of wind development and recommends rule changes.

Minnesota Solar Generation Tripled Last Year as Solar Gardens Take Root

The Minnesota Department of Commerce reported that the state added 467 megawatts of solar capacity in 2017, versus 209 megawatts the prior year, with growth driven by community solar installations, according to the agency’s Jan. 25 press release. Capacity from community solar, which allow consumers to subscribe to solar installations, reached 287 megawatts last year from 94 sites. The state set a goal to reach a gigawatt of solar capacity by 2019.

Delaware Unveils Cost Cap on Renewable Targets for Retail Power Suppliers Following Court Challenge

The Delaware Public Service Commission will freeze renewable energy targets for retail electric suppliers if the cost to comply with the renewable energy program exceeds 3 percent of the retail cost of power under new rules adopted by the agency. The rule comes after the Delaware Division of the Public Advocate prevailed in its legal challenge at the Delaware Superior Court in which it asked the commission to set rules for when to freeze renewable requirements. The state set a mandate for 25 percent of retail sales to come from renewable sources by 2025.

Montana Shows Reliance on Coal Hard to Shake as Drought Depleted Half of State's Hydropower Last Year

Severe drought saw Montana’s share of electricity from hydropower in July, the month with the highest electricity demand, fall to 32 percent from as much as 60 percent in an average year, according to a Jan. 19 report from the U.S. Energy Information Administration. When hydropower, the state’s second largest source of electricity, is cut, the shortfall is made up from higher generation from coal plants.

Georgia Regulator Slams Trump's Solar Import Duties, Underscoring Job Losses

Georgia Public Service Commissioner Lauren “Bubba” McDonald, a strong Trump ally, blasted a decision by the White House to impose a 30 percent tariff on imported solar, saying the move will hike prices and lead to fewer installations. McDonald, who testified against the measure at a U.S. International Trade Commission hearing in August, said he was pleased the tariff will be scaled down each year. The tariffs stem from a complaint last year by bankrupt Suniva Inc., a Georgia-based, Chinese-owned solar manufacturer, which argued it was harmed from a flood of imports.

Grid and Power Markets

U.S. Unveils Rules to Improve Grid’s Emergency Preparedness and Reliability as Threats Grow

The Federal Energy Regulatory Commission on Jan. 24 approved regulations designed to ensure accurate reporting of system disruptions, specifying the roles of generators needed to restore service, and clarifying the process for restarting a downed grid or operating without a functioning control center. The rules, which will take effect on March 26, come as the nation’s electric system faces a barrage of cyberattacks and saw unprecedented damage to the grid from extreme weather.

Mid Atlantic Grid Operator’s Capacity Market Offer Cap Jumps 11 Percent Reflecting Increase in Cost of New Entry

PJM Interconnection LLC on Jan. 26 finalized an offer cap value of $237.56 per megawatt-day to sell offers in the upcoming capacity market auction for delivery years 2021/2022, higher than the previous auction’s limit of $214.81 per megawatt-day. The change reflects an increase in the net cost of new entry to $302.63 from $273.64 per megawatt-day. The offer cap is determined by averaging balancing ratios for performance assessment hours for the three calendar years preceding an auction. The grid operator used the same 78.5 percent balancing ratio used in the 2020/2021 auction, which was the first one to apply 100-percent capacity performance requirement imposing stiff non-performance standards.

Federal Regulator Clears Extension to 2017 Midwest Capacity Auction Following System Glitch

The Federal Energy Regulatory Commission accepted Midcontinent Independent System Operator Inc.’s request in July to push back a deadline to accept supply offers for its 2017/18 capacity auction after the system intermittently lost connection due to a hardware failure. The commission found that the disruption could have prevented some participants from submitting offers in the final hours of the three-day submission window. Public Citizen, a watchdog group, disputed whether the change in the cutoff date was necessary, and said the operator failed to provide the cause of the disruption.

Illinois Commission Backs ComEd’s Chicago Microgrid Pilot Project

The Illinois Commerce Commission granted preliminary approval of Commonwealth Edison Co.’s Bronzeville community microgrid pilot, a decade-long program to develop best practices for siting, integrating and operating the systems. The $25-million project by the Exelon Corp. subsidiary draws on funding from the Energy Department. Microgrids have gained favorability among utilities across the nation as a means to optimize service to consumers and improve system reliability.

Other

Georgia Consumer Watchdog Challenges State Support for Troubled Vogtle Nuclear Plant, Citing Costs

Ratepayer advocate Georgia Watch asked the Georgia Public Service Commission to reconsider its decision in December to support the construction of two reactors at the Vogtle units nuclear plant, citing erroneous cost projections. The project by Southern Co. has been beset by delays and billions in cost overruns.

U.S. EPA Withdraws Decades-Old Power Plant Emissions Rule in Move Said to Spur Pollution Control Upgrades

The U.S. Environmental Protection Agency withdrew a 1990s-era Clean Air Act rule that prevented power plants from being reclassified as a lower emitter subject to less restrictive control standards, even if the facility cuts its potential to pollute below a prescribed level, according to a Jan. 25 press release. The agency expects the action to provide incentive for plant operators to invest in pollution reduction technologies. The repeal of the so-called “once in always in” policy marks the latest action by the Trump administration to scale back regulations it says are unnecessarily burdening industry.

California Approves Utilities' $41 Million Electric Vehicle Program for Trucks in Latest Move to Green State's Transportation Sector

The California Public Utilities Commission authorized over a dozen pilot projects by San Diego Gas & Electric Co., Pacific Gas & Electric Co. and Southern California Edison Co. to electrify medium and heavy-duty trucks, buses and equipment for the benefit of low income communities. The projects, to be rolled out within a year, are expected to stimulate investment to scale-up transportation electrification in various sectors. The programs fall under a law passed in 2015 establishing California’s clean energy, clean air and greenhouse gas reduction goals for 2030.