It was a year ago this week that much of the United States was in the grips of a bomb cyclone. As the temperatures plummeted and stayed put, people cranked up their heat and generators were working at full capacity to meet the demand. While most of the country was concerned with keeping warm, traders & generation managers were managing their positions closely.
With winter officially upon us it is important for traders to make sure they have all of the data available to make informed decisions when extreme weather occurs. Knowing how the fundamentals (Load, Generation & Transmission) impacted the market last winter prepares traders for this winter.
Using our Constraint Summary tool we’ve compiled a list of the 5 largest constraints in PJM last winter (12/1/2017 - 2/28/2018). While we know that high load was impacting these constraints, we used our Shift Factor to determine which of the Live Power monitored generators were most correlated to these constraints.
While not all of these constraints occurred during the Bomb Cyclone we should note that the Cloverdale constraint did. If you’re a customer, you can learn more about that in this in-depth look at its driving cause.
Top 5 Highest Impacted Power Plants with a non-zero shift factor for their associated price node. The Shift Factor (-1 to +1) indicates the congestion impact on the price node. For more information about our Shift Factors click here (requires a login).
Focusing in on key generators allows traders to respond to potential market drivers such as generation ramps up & down, unexpected % capacity & power plant trips. Here’s an example where a generator experienced a trip during the bomb cyclone last year and how it impacted the market.
Using Live Power Generation Data we were able to see generation at Fayette Power Plant, located near Pittsburgh, PA. On January 5th the high temperature for that area was 9 degrees fahrenheit (~25 degrees below normal) and generation at Fayette was running at full capacity up until the plant tripped to zero a little before noon. Here’s a look at how it played out:
As can be seen in this video, a trader being able to respond to a plant trip quickly can mean the difference between a very good day and a very bad day. This is even more true when in the midst of a weather event like the Bomb Cyclone. The market was already experiencing volatility when this trip occurred making its impact even greater. In fact, the entire winter of 2017/2018 was more volatile than the previous year with the West Hub Average Real-time price of $49.35 compared to the 2016/2017 average of $29.72.
Yes Energy published a report last January examining the generation response in PJMISO throughout the bomb cyclone. This report, linked below, outlined which plants were running at capacity and helping to keep prices low (or lower than they would have been) and which plants were not running at full capacity throughout the Bomb Cyclone. Should an extreme weather event occur this year Live Power is monitoring generators in PJM at 1 minute intervals and this data is available throughout Yes Energy product.