weekly market updates

The latest information about the energy market

  • Natural Gas Futures Quotes

  • CGV’s Proposed Rate Case will Increase Delivery Charges for TS-1 and TS-2 Accounts - June 15, 2016

    Columbia Gas of Virginia recently sent out letters to all TS-1 and TS-2 accounts notifying them about the rate case and the changes/ increases to each rate.  In addition to a proposed increase in the bank penalty fee and the daily transfer service fee, as well as the proposed indexes to use for any index-related pricing in the tariff,  CGV is also asking for a significant increase in their delivery (non-gas) charges.  Currently, TS-1 and TS-2 customers pay a delivery rate based on a tiered scale for each Dth of usage per month.  The proposed changes to the delivery rate represent a 17.08% increase over the current delivery charges for TS-1 accounts and a 23.61% increase over the current delivery rates for TS-2 accounts.

    To put this in perspective, if you use 2000 Dth per month on average under the TS-1 rate, your CGV delivery charges will increase by $423.68 per month on average.

    If you use 10,000 Dth per month on average under the TS-1 rate, your CGV delivery charges will increase by $1074.33 per month on average.

    If you use 30,000 Dth per month on average under the TS-2 rate, your CGV delivery charges will increase by $2964.42 per month on average.

    If you use 60,000 Dth per month on average under the TS-2 rate, your CGV delivery charges will increase by $4779.42 per month on average.

     CGV has asked for the increase in their rates as they are expecting an annual revenue deficiency of $37 million, of which $30 million is expected to be recovered by customer rate increases.  Part of this also includes asking for a higher return on equity, which is currently set by the 2014 rate case at 9%-10%, and CGV is now requesting an increase to 11.25%. 

     

    June 15, 2016
  • CGV Files for Rate Case which will Impact TS1 and TS2 Rate Schedules - May 13, 2016

    CGV has applied for changes to be made to their TS-1 and TS-2 rate schedules in Case # PUE-2016-00033 with the State Corporation Commission. Enspire Energy is concerned about the following 4 changes and how these changes will impact the future costs/ transparency to TS-1 and TS-2 accounts:

    1. Standby Service: CGV is proposing a change to how the Commodity Charge portion of the Standby Service is calculated. Currently, the tariff reads as follows:

    b. Commodity Charge – The first-of-month mid-point Transco, zone 6 non-N.Y. index price, as published in
    Gas Daily, times the standby quantities delivered for the month.

    CGV now wants to change the relevant index point for pricing Standby quantities to the following:

    b. Commodity Charge – The highest of -1) the average of the Daily Index prices for each day of the
    applicable month as reported in the PLATTS Gas Daily publication, in the Daily price survey section
    under the heading “Transco, zone 6 non-N.Y.” Midpoint, 2) the average of the Daily Index prices for
    each day of the applicable month as reported in the PLATTS Gas Daily publication, in the Daily price
    survey section under the heading “Transco, zone 5 del.” Midpoint, or 3) the highest commodity cost of
    purchases by Company during the calendar month, including the .cost to deliver the purchases to the
    city gate, if any, excluding any purchases under fixed price commodity contracts for which the price
    was determined more than thirty days before the beginning of the calendar month, times the standby
    quantities delivered for the month.

    2. Banking and Balancing Service: CGV is proposing a $.01 increase, from $.32 to $.33 per Dth on all volumes that exceed each customer’s allowed bank tolerance, also called an over the allowed bank penalty. CGV is pointing to the upstream pipeline overrun charges as justification for this increase.

    3. Banking and Balancing Service: CGV is proposing to change how they invoice customers when they deliver less than they use in a given month, and when all banked volumes and standby service have been used, what is known as cashout volumes.

    Currently, the tariff reads as follows:

    For any billing month when the Company’s deliveries to the Customer at its facilities exceed
    Customer’s deliveries to Company plus the Customer’s contracted daily Standby Service quantities,
    available banked quantities, and Daily Gas Transfer Service Quantities, the Customer will be billed for
    any such excess consumption (“Excess Quantities”) at the average of the mid-point Transco, zone 6
    Non-N.Y. citygate prices for deliveries as published in Gas Daily for the month in which such Excess
    Quantities are delivered. The foregoing charges are in addition to any penalties, fees and charges to
    the Customer pursuant to this Rate Schedule.

    CGV now wants to change the relevant index point for cashout volumes to the following:

    For any billing month when the Company’s deliveries to the Customer at its facilities exceed
    Customer’s deliveries to Company plus the Customer’s contracted daily Standby Service quantities,
    available banked quantities, and Daily Gas Transfer Service Quantities, the Customer will be billed for
    any such excess consumption (“Excess Quantities”) at the highest of 1) 120% of the average of the
    Daily Index prices for each day of the applicable month-as reported in the PLATTS Gas Daily
    publication, in the Daily price survey section under the heading “Transco, zone 6 Non-N.Y.” Midpoint,
    2) 120% of the average of the Daily Index prices for each day of the applicable month as reported in
    the PLATTS Gas Daily publication, in the Daily price survey section under the heading “Transco,
    zone 5 del.” Midpoint, or3) 120% of the highest commodity cost of purchases by Company .during the
    calendar month, including the cost to deliver the purchases to the city gate,’If’ any, excluding.any
    purchases under fixed price commodity, contracts for which the price was determined more than-thirty
    days before the beginning of the calendar month. The foregoing charges are in addition to any
    penalties, fees and charges to the Customer pursuant to this Rate Schedule.

    4. Daily Gas Transfer Service: Customers and marketers use this service to correct penalties when possible by transferring gas from one customer that used less than what a supplier delivered on a BSR day to a customer that unexpectedly used more and would otherwise incur a BSR penalty. CGV has proposed making this service more expensive by increasing the minimum charge from $15 for a transfer of up to 750 Dth to $15 for a transfer of up to 250 Dth. For volumes transferred exceeding the minimum charge, they are proposing changing the fee from $.02 per Dth to $.06 per Dth. CGV’s justification for the increase in daily transfer charges is that it takes 21 minutes on their side each time a daily transfer is done to go through their checklist of approvals and send confirmation through their system that the transfer is approved.

    CGV has proposed other changes to their tariff, and all of the relevant documents may be found on the State Corporation Commission’s website by searching under Case No. PUE-2016-00033. Please feel free to call 757-963-9123 or email Mary Hensley at [email protected] to discuss how these proposed changes may impact your account specifically.

    May 13, 2016
  • Natural Gas Storage Levels Hit a Record 4 Tcf - November 19, 2015

    Natural gas storage levels hit a record 4 Tcf for the week ending November 13th, as reported by the EIA this morning. Total levels increased by 15 Bcf, which was actually below expectations, which were calling for an injection in the range of 17-21 Bcf. Also, this is the first report utilizing a 5-region estimate, as the EIA has always used a 3-region estimate before. Total gas in storage is now 404 Bcf above the same period last year, and 207 Bcf above the 5-year average.

    November 19, 2015
  • New Mountain Valley Pipeline Proposed to Bring Additional Gas Supply into Virginia - October 6, 2015

    An additional new pipeline is being proposed to bring natural gas from West Virginia, starting in Wetzel County, down through the western portion of the Commonwealth of Virginia, connecting to Roanoke Gas, and eventually interconnecting with Transco Z-5 in Pittsylvania, VA. The proposed pipeline is a joint venture between EQT Midstream Partners, and affiliates of NextEra Energy, WGL Holdings, and Vega Energy Partners, and they recently announced a deal with Roanoke Gas Company, who will be a shipper on the pipeline to supply and expand its service area in southwest Virginia. The pipeline plans to file a certificate application with FERC in late October, and hopes to start construction next year, with an expected in-service date of November 2018. A link to the proposed map for the new 300 mile, 42″ inch diameter pipeline is as follows: http://mountainvalleypipeline.info/.

    October 6, 2015
  • November NYMEX Trades Under $2.50 - October 3, 2015

    The November NYMEX fell $.091 on Thursday, to close the day at $2.433. The sell-off was due to low shoulder season demand, lower short-term demand expected due to Hurricane Joaquin bringing rain to the East Coast, and high volumes of gas in storage for the upcoming winter season. The EIA reported a net increase of 98 Bcf for U.S. natural gas storage, which was at the low end of the expected range, but still keeps current storage levels 454 Bcf above this time last year, and 152 Bcf higher than the 5-year average. For the week, the November NYMEX contract was down $.237, and Thursday’s close at $2.433 was the lowest close for the prompt month contract since June 2012.

    October 3, 2015
  • Platts Gas Daily Proposes to add a new index pricing point for Transco Z-6 Non NY - August 5, 2015

    Platts is currently seeking feedback on its proposal to add a new index pricing point for Transco Z-6 Non NY South to its daily and monthly survey. The proposed Transco Z-6 Non NY South index would cover deliveries from the beginning of Zone 6 at the Maryland/ Virginia border up to Station 195 in York, PA. The planned effective date for this pricing point to appear in Platts Gas Daily will be with the September 1, 2015 edition.

    August 5, 2015
  • August NYMEX Natural Gas Contract Settles at $2.886 - July 30, 2015

    The August NYMEX natural gas contract settled at $2.886 on Wednesday, July 29th. This was up $.065 for the day, for a contract that has been up the prior two days of trading as well. The main rationale for the climb has been forecasts for above normal temperatures for the first part of August throughout most of the United States.

    Today is the first day of trading for September as the prompt month, and the NYMEX is down slightly this morning, with September currently trading at $2.832, a decline of $.032. The US EIA will be releasing their weekly storage report this morning at 10 :30 AM EST, and early indications are for an injection of between 53 to 57 Bcf. An injection within the expected range would be significantly below last year’s injection of 88 Bcf, but slightly above the 5-year average injection for this week, which is 48 Bcf.

    July 30, 2015
  • Atlantic Coast Pipeline Update- New Pipeline Proposed for Virginia - July 30, 2015

    A new pipeline is being proposed to be built in Virginia. It is called the Atlantic Coast Pipeline, ACP for short, and it is being sponsored by Dominion Virginia Power, AGL Resources (the parent company of Virginia Natural Gas), Duke Energy, and Piedmont natural Gas. The pipeline is designed to bring gas in from the cheaper Marcellus Shale in West Virginia and western Pennsylvania to markets in Virginia and North Carolina. A project overview map can be seen on Dominion’s website at the below link:

    https://www.dom.com/library/domcom/pdfs/gas-transmission/atlantic-coast-pipeline/acp-exhibit-a-project-overview-map.pdf

    The pipeline will run through a large portion of Columbia Gas of Virginia’s territory, though CGV has not committed as a shipper on the pipeline as of yet. Virginia Natural Gas will have a 70 mile spur that will run through Suffolk and Chesapeake, VA. The added expected capacity at VNG’s citygate will be about 75,000 Dth/ day. The pipeline will have total capacity of 1.5 Bcf/day, and of that 1.3 Bcf/day is currently committed between the 4 founding shippers. There is about 60,000 Dth/day that is not committed and does not have a first right of refusal associated with it. The pipeline will be fairly easy to expand to a total capacity of 2 Bcf/day.

    Receipt point pricing in West Virginia is expected to be similar to where Dominion South pool trades, which is typically well under Columbia Appalachia pricing. The founding shippers are paying a demand rate of $1.07 per Dth, which when you factor in the reduced receipt point costs, would make this pipeline much cheaper for accounts behind CGV where TCO or Transco Z-5 are their only pipeline options. This would be a more expensive option for those accounts behind VNG where they are already getting to take advantage of discounted pricing off of DTI.

    Enspire Energy attended a recent meeting in Chesapeake with the business development person for ACP, Lyle Henry. The pipeline is looking to engage industrial accounts who may have an interest in looking at contracting for capacity. Some questions will still need to be answered, including how the pipeline plans on handling daily balancing options for industrials. While there are no planned interconnects with CGV’s system at this time, certain large industrials might want to talk to ACP about looking at expanding deliverability at Emporia, which may provide deliverability to market area #34.

    The current timeline for ACP is to be operational for gas deliveries for November 2018. Once completed, this pipeline will substantially increase deliverability in Virginia, and should have the effect of reducing basis pricing overall for the state.

    July 30, 2015
  • Daily Market Update - July 9, 2015

    The US Energy Information Administration reported a net injection of 91 Bcf for the week ending July 3rd.  This was above the consensus estimates calling for an injection in the range of 84-88 Bcf.  The August NYMEX natural gas contract was down initially on the news, trading at a low of $2.644 per Dth.  The 91 Bcf injection compares to an injection of 94 Bcf for the same period last year, decreasing the total surplus when compared to last year to 659 Bcf.  The 91 Bcf injection was well above the 5-year average for the same period, which was an injection of 75 Bcf, increasing the total surplus compared to the 5 year average to 45 Bcf.

    July 9, 2015
  • Daily Market Update - July 2, 2015

    Spot cash market pricing for deliveries to VNG dropped substantially ahead of the July 4th weekend.  Delivered pricing off of DTI was as low as $.80 per Dth at the citygate of VNG.  Unfortunately, Z-5 pricing was actually slightly stronger, and TCO pool pricing was only at a slight discount for the weekend.  The August natural gas contract edged up for the day, closing at $2.822 per Dth.

    July 2, 2015
  • Daily Market Update - June 26, 2015

    The July 2015 natural gas NYMEX settle came in at $2.773 per Dth.  This was a decline of $.077 for the day, almost entirely erasing the $.091 gains from Thursday.  The downswing appeared to be due to expected moderating temperatures, assisted by wet conditions from El Nino, forecasted for July.

    June 26, 2015