Comments on: Market Speaks: Impacts of EPA Train Wreck Will Be Much Higher Than Anticipated

By: Here Come Obama’s ‘Necessarily Skyrocketing’ Electricity Rates « PA Pundits – International

Fri, 10 Jun 2011 10:02:01 +0000

[...] to meet anticipated demand, and it projects EPA regulations are going to increase capacity costs in the magnitude of $2 billion–$3 billion for a one-year period. PJM also “concluded that “60 to 80%” of the increase in generators bid [...]

By: Here Come Obama’s ‘Necessarily Skyrocketing’ Electricity Rates | The Foundry

Thu, 09 Jun 2011 17:37:16 +0000

By: BobRGeologist

BobRGeologist — Sun, 05 Jun 2011 02:24:10 +0000

There are no surprises here, only that this totally unnecessary expense is allowed to happen due to the supreme ignorance and greed of our politicians.This will go down as the fleecing of middle class America over a badly flawed hypothesis (AGW). There has been over $30 billion expended in Gov’t research grants trying to prove that dangerous global warming will result from man’s increasing use of fossil fuels since the Industrial Revolution began 150 years ago. We have been in a normal warming trend since the Little Ice Age bottomed out aroound 1300 AD. Warming maxed around 1940, slight cooling to 1970, slight warming to 2000, none since. Egregious lying claiming unprecented warming is totally unprovable, but this myth has a life of its own due no doubt to the huge investment in the concept. In truth, with ice in our polar regions and several degrees lower global temperatures, I maintain we are still in a glacial mode and much more likely to lapse into Pleistocene Ice Age No. 6 because our weak Sun is dependant on a vigorous greenhouse gas to prevent another snowball Earth event (twice in the distant geologic past ice to the equator). Please, please humanity, do not try to eliminate GHG.

By: Anonomous

Anonomous — Sat, 04 Jun 2011 05:07:46 +0000

Certainly the EPA rules had some impact on the auction, but there are 2 other large changes that caused the increase in the clearing price for the PJM RTO. The combination of the other changes in the 2014/15 auction make it difficult to measure the true impact of the EPA regulations.

First, in the last 2 auctions, the MAAC region (the eastern part of PJM) was constrained. So, for the 2013/14 delivery period, even though RTO clearing price was low ($27.73 /MW-day), the MAAC clearing price was very high ($226.15 /MW-day). For the 2014/15 delivery year, RTO cleared at $125.99 /MW-day, but since MAAC was un-constrained it only cleared at $136.50 MW-day. Due to the auction dynamics, when the east becomes less constrained, its price will decrease and the west price will increase. If you compare the weighted average clearing price across all of PJM, for the 2013/14 delivery year the capacity price is about $123 /MW-day and for 2014/15 the price is about $133 /MW-day. So, across the entire PJM system, the increase wasn’t really from $27.73 to $125.99, even though that is the change in the RTO price.

Second, the increase in the generator’s offer price was not solely due to the new EPA regulations. Based on the PJM tariff, generator offer prices are capped based on their fixed costs required to continue operations for one year minus the average revenues they made in the last three years of operations. This basically means that if a generator can pay its bills using money from the energy market, it will be forced to bid into the capacity market at $0. However, if a generator is not making enough money in the energy market, it can bid higher. If that higher bid clears in the capacity market, it is a price signal to the generator that it is needed for reliability, and it will receive the additional money needed from the capacity market. The 2013/14 capacity auction used revenues from 2007, 2008 & 2009 for this offer cap calculation, whereas the 2014/15 auction was using 2008, 2009 & 2010 for this calculation. Dropping off 2007, when energy prices were high, and replacing it with 2010, when energy prices were low, allowed generators that were forced to bid in at $0 in the 2013/14 auction to bid in higher in the 2014/15 auction. How much higher is impossible to measure, and depends on each generator’s economics.

Also, I would like to note that the $126 clearing price is not as anomalous as it seems when you look further back in history. The RTO clearing prices have been as high as $174 /MW-day and it may be more accurate to say the low clearing prices were anomalous.

2007/2008 – $40.80
2008/2009 – $111.92
2009/2010 – $102.04
2010/2011 – $174.29
2011/2012 – $110.00
2012/2013 – $16.46
2013/2014 – $27.73
2014/2015 – $125.99

Finally, the last bullet in the article above states ‘Analysts have concluded that these prices are not “likely [to] decline meaningfully anytime soon, and thus, we expect the clearing price levels to remain relatively elevated (versus the 2013/2014 auction) for the foreseeable future.”’ Are these the same analysts who predicted the auction would clear at $40? I have read many of those analyst reports, aside from all being wrong in predicting the auction clearing price, they had one other thing in common: They all included, or said they included, the impact of the EPA regulations, however, none of them included the 2 changes I have cited above.

Auction rules are here: http://pjm.com/~/media/documents/manuals/m18.ashx

By: Green-Red coalition destroying Western society and global economy | JunkScience Sidebar

Fri, 03 Jun 2011 05:29:47 +0000

[...] Market Speaks: Impacts of EPA Train Wreck Will Be Much Higher Than Anticipated by MARLO LEWIS on JUNE 2, 2011 [...]

By: BobRGeologist

BobRGeologist — Fri, 03 Jun 2011 03:23:05 +0000

It was a well kept secret in the media that over 30,000 US scientists, myself included, had signed the (petition project) in early 2008 urging our Senate to not sign the Kyoto Protocols that would have committed us to stringents limits on the release of carbon dioxide into the atmosphere by all sources using fossil fuels. Environmentalists had convinced many governments that this would cause our world to warm to dangerous levels. There is nothing new about climate change as any geologist or paleontologist knows. I was in a state of shock when I read the Protocols over 10 years ago and have been a skeptic ever since. However, the gullible public was so threatened about it becoming too warm for life to thrive by idiots and charlitans hoping to profit by a host of crash remedies we still are in the testing stage with. The skeptics have been attacked as all sorts of villians while pefrhaps a thousand or so climate scientists were enjoying lucrative research endowments to prove the danger of CO2 and other greenhouse gases,
an abject failure. Politicians made the grevious mistake of annoiting this shady hypothesis (AGW) with the mantle of political correctness. Real science is just beginning to be recognized as correct by the general public. The media seem to be the last to recognize they bet the farm on sensatiionalizm. I am beginnning to hope that our world governments will finally realize that controlling climates is too big for humanity.