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The November wholesale exchange contract was higher yesterday by $0.054 as the 6 to 10 day forecast continues to call for below average temperatures in the South and Mid West. This seems to be the catalyst for the market strengthening over the last week and it seems to coincide with the upcoming winter season. How high it will go remains to be seen, but there are a lot of energy traders that have sold natural gas wholesale contracts expecting lower profits and we all know what they have to do if they are wrong. Only time will tell. Early estimates for the EIA storage change number are now in the low to mid 80 bcf area versus last year’s build of 74 bcf. The release of the EIA storage change number will occur on the same day that the November wholesale contract expires which is tomorrow as everyone knows what happens on Thursday’s.
On the smart meter front, utilities are investing in high-tech meters that not only track energy use but also provide other kinds of information. At the same time, their customers are divided in their willingness to accept the new technology, according to a new report from J.D. Power and Associates. The study has relevance for central Ohio, where American Electric Power has installed "smart meters" in 110,000 households, part of a test that might precede a wider rollout. The meters give customers new tools to track their electricity usage, and they allow two-way communication with the utility. J.D. Power, a California-based research firm, says that about one in 10 customers has no interest in the new meters, while about the same number have an extremely high interest. The "indifferent" segment, as the study calls it, will object to covering the costs for the new meters and will be unwilling to take action to gain benefits from the meters. At the same time, the "innovator" segment will want more information than the utility can provide, and may be frustrated that the meters don't do more. Between those extremes is a group that J.D. Power calls the "automate" segment, which represents about 1.5 out of 10 customers. This group is willing to give the utility increased data and control if the result is a reduction in costs.
On the home front, a former Apple executive says he's moved on from smartphones and computers and set his sights on the next digital challenge, the humble home thermostat. "We've built the world's first learning thermostat, a thermostat for the iPhone generation," Tony Fadell said of the effort of his new Silicon Valley startup, Nest Labs. Fadell, who led iPod and iPhone development at Apple from 2001 to 2009, said his team of 100 computer and software experts has changed the thermostat from a dumb switch to a smart digital helper that can save homeowners money and reduce energy consumption. The high-tech programmable thermostat has lots of tricks up its sleeve, like motion-tracking sensors that know when people are present and make appropriate temperature adjustments. Nest Labs said its programmable thermostat would go on the market in November at $249.
Continuing on the wind front, wind energy is more affordable than ever and new installations across the country are saving consumer’s money on their electric bills, as utilities rush to lock in long-term favorable rates. The U.S. wind industry installed just over 1,200 megawatts (MW) in the third quarter and about 3,360 MW on the year so far, but has more than 8,400 MW under construction. That is more than in any quarter since 2008, as the federal Production Tax Credit has driven as much as $20 billion a year in private investment. The third-quarter results released today by American Wind Energy Association indicate the year will finish strong, somewhere between the industry’s high point of 2009 and the recent dip in 2010 amid turmoil in federal tax policy. Years of technological innovations and an influx of U.S.-based manufacturing have driven down the cost of wind energy and saved further on transportation. Including incentives, which all forms of energy get, U.S. wind is now close to cost-competitive with all other energy sources, even shale gas at today’s unsustainable prices. Even so, policy uncertainty has many leading wind developers saying they have no projects scheduled for 2013, which is starting to threaten both development companies and the U.S. wind energy supply chain.
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