New Media
Broken turbine blade adds to headwinds for Connecticut offshore projects
Westfair Business Journal – Justin Mcgown
“If we’re going to spend billions of dollars building these wind farms, we need to be sure they are prepared for weather conditions in 2050, not conditions that existed in 2020,” Robert McCullough, managing partner of McCullough Research told CT Insider. “We are unprepared for the rapid nature of climate change. And we don’t have a good sense of how powerful off-shore weather conditions are.”
Vineyard Wind project halted after turbine blade incident
The Register Citizen – Luther Turmelle
Robert McCullough, managing partner of McCullough Research, said the Vineyard Wind incident ought to result in a serious reassessment of wind power projects by government and industry officials. McCullough said that the turbines, blades and other components that are part of wind farms are not being adequately tested in terms of their ability to hold up in the rapidly evolving weather conditions produced by climate change.
Rising Frustration in Houston After Millions Lost Power in Storm
Utility experts said that power companies have little excuse for not being ready for events that develop over the course of days, in particular when the primary job is to deliver safe, reliable service.
“Most of all, it really is the preparation issue,” said Robert McCullough, of McCullough Research, a consulting firm based in Portland, Ore. “Mild storm. Why weren’t we better prepared?”
New Articles
Whither Hydro-Québec?
High above René Lévesque Boulevard in Montreal looms the redoubt of Hydro-Québec — long one of the most secretive utilities in North America. While resource plans at other utilities in Canada and the U.S. can run to thousands of pages — including detailed studies of markets, technologies, loads and transmission — Hydro-Québec’s periodic Strategic Plans have slowly but surely shrunk to a minimalist report announcing their existence, their profound popularity and their contribution to the Quebec economy.
In March, the tiniest glimmer of information was released from la
forteresse d’Hydro-Québec.
Increasing U.S. Oil Production During Ukraine Invasion
Successful oil sanctions against Russia will cause less harm to the world economy if U.S. oil production ramps up. Unfortunately, the U.S. response to high oil prices has been slow and cautious. To meet needs in Europe, the U.S. may need to consider financing support for independent wildcatters in mid-continental oil fields to accelerate U.S. oil production.
One Tomb Raider Good: Two Tomb Raiders Better
The poorly drafted New York contract will probably face many of the same problems that the similarly drafted contract with Massachusetts has had in New Hampshire and Maine. The lack of transparency creates suspicions, the lack of co-operation creates enemies, and the lack of environmental substance creates opponents. All three problems are relatively easy to solve — however, I think we will find that if one tomb raider is good, two are better is the wrong model.
New Reports
Comments on SB X1-2 Workshop on Maximum Gross Gasoline Refining Margin and Penalty
Restrictions to the maximum margin changes the incentives for any number of market abuses ranging from exaggerated public announcements to wash trades designed to raise the OPIS index. The management of the refineries will exercise more supervision over their California operations if they face the incentive to do so. Absent such incentives, the unexplained market events experienced over the past decade will continue.
West Coast Gasoline Price Excursions in September 2022
In September 2022, West Coast consumers saw the second highest gasoline prices in history even while global oil prices were falling.
Data from the federal Energy Information Administration and the California Energy Commission indicate that production did not decrease during the period of the high prices.
McCullough Research concludes that West Coast refineries’ explanations that unforeseen shortages cause gasoline price increases are questionable, considering that the usual practice is to build inventory to cover sales during operational shutdowns. The attached memo finds little evidence that a supply shortage caused the price spike.
Market surveillance and transparency assure efficient markets, yet the Federal Energy Regulatory Commission and the Commodity Futures Trading Commission do not provide routine surveillance, and until the nation’s gasoline and oil markets are subject to the same procedures that are routine for all other energy markets, the West Coast is vulnerable to market manipulation.
Ensuring Transparency in Petroleum Markets
The economic impacts of the Russian Federation’s war on Ukraine have surprised many. The rapid increase in oil prices reflect a legitimate concern that the world’s largest oil ex-porter – Russia – may restrict exports or be subject to international boycotts or embargoes. However, in many cases, public perceptions of the United States and its energy balance have lagged behind market developments. This has led to unfounded fears of a 1970s style energy crisis.
The most effective policy to curb Russian aggression in Ukraine is to displace Putin’s oil exports with enhanced U.S. production while protecting U.S. consumers from unnecessary price increases at the pump.
I have conclusions and recommendations in three areas: transparency, drilling, and windfall taxes