What’s Up With Natural Gas Prices?

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The natural gas market appears hesitant to react to forecasted temperatures well-below-average for the eastern half of the U.S. through the middle of December.  Overall US demand levels for December are projected to average 94.1 Bcf/day, exceeded only by December 2013 ahead of the polar vortex winter and December 2016 when NYMEX prices were near $4/MMBtu.  Over the last four trading sessions, the January NYMEX has dropped 19.4 cents.  Currently the NYMEX Henry Hub Gas Futures contract average price for 2018 is at $2.92/MMBtu.

Instead, the emphasis has been placed on strong production levels.  Growth in natural gas demand remains robust. Pipeline exports to Mexico and consumption in the chemical sector are surging, exports of liquefied natural gas (LNG) have reached 2 Bcf/d, and utilities are moving toward fast-cycling natural gas plants to complement increasing amounts of intermittent renewables on the grid.  Each of these components have increased natural gas demand in recent years. However, natural gas production growth has kept pace.  Current national production levels continue well above 76 Bcf/d, more than 5 Bcf/d above year-ago levels.

Regional Gas Operator Qualification (OQ) Pooling Meetings

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On December 6, 2017, municipal gas utilities met in Humbolt to discuss pooling of resources to better meet Operator Qualification (OQ) training and certification.  The meeting was facilitated by Dixie Riedel, Gas Director for KMGA and was hosted by the City of Humbolt.  This meeting was held for cities in the Eastern part of the State.  Another meeting was held on November 30, 2017 and it included cities in the South Central part of the State.  The meeting goals are to facilitate the pooling of municipal gas utilities that are located in the same region and to work together to better train and certify staff as well as support other communities in the pool.

In 1999, the Operator Qualification (OQ) rule was adopted into the Code of Federal Regulations.  The rule requires natural gas pipeline operators to document that certain employees have been adequately trained to recognize and react to abnormal operating conditions that may occur while performing specific tasks.  OQ records must be made available for inspection by the Pipeline and Hazardous Materials Safety Administration (PHMSA) and the Kansas Corporation Commission (KCC).

We have made contact with 31 municipals across Kansas regarding OQ Planning.  Discussions from these meetings have proven both the need and willingness for cities to work together and assisting one another.  Regional meetings will continue to be held in the upcoming months.

 

Do Your Supervisors and Managers Have the Skills They Need?

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Strong frontline employees often get tapped for supervisory positions, and from there some will move into management. But not all staff who make these transitions get the training they need to thrive in their new roles. Which is a shame—because investing in skills development for supervisors and managers has real payoffs for organizations in both day-to-day effectiveness and for long term performance.

The KU Public Management Center offers training for technical experts who have moved into supervisory and management roles to hone the skills necessary for success. For supervisors, the 3-day Supervisory Leadership Training course is designed to ensure both new and experienced supervisors walk away with enhanced skills and new strategies for leading staff effectively.

For managers, the Kansas Certified Public Manager® Program (CPM) is a nationally accredited training which brings participants together for two days per month from January to November to strengthen their management skills. The investment in CPM impacts not just the individual manager’s performance but can also have significant effects on organizations as managers apply the knowledge gained from the program and implement a capstone project developed in collaboration with their agency. Participants engage with instructors and peers who share an understanding of the challenges and opportunities faced in public organizations. 2018 CPM is enrolling now; register by December 1 for the early-bird discount.

Welcome To The Future

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It wasn’t that long ago when we thought wind energy was such a small amount of the overall generation mix that it would never prove to be a game changer. Well, today we know that over the years the incremental installation of wind generation has done just that. The next question might be – Is energy storage the next game changer? It looks like that could be very possible. We know that wind generation, along with other renewables, has driven the energy market prices down to unbelievable lows. Could energy storage and its ability to stabilize the power grid combined with wind energy have a similar effect on the energy market?

The link below will take you to a story that will likely become the new headline in the electric industry. Tesla has installed a 129MWh battery facility at a wind farm in Australia that is designed to stabilize the electric grid.

An accompanying article in this newsletter talks about the installation of a new energy storage facility in Springfield, Missouri. Although it is not nearly as large we will soon see more and more of these projects in the headlines. Because of the need to solve a problem, new technologies, and innovative minds we are experiencing things that seem a bit futuristic but the future is now.

Click for Tesla

Humboldt Featured on NBC Nightly News

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Dogwood Tour

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On October 16th representatives from the City of Garden City and the City of Russell along with KMEA staff members participated in a tour of the Dogwood Energy Facility. The Cities of Garden City, Gardner, Lindsborg, Ottawa and Russell have approved their cities’ participation in the Dogwood Project. KMEA is currently in the process of purchasing approximately 10.1% of the Dogwood Energy Facility which equates to approximately 62 Megawatts.  The 5 KMEA Member Cities’ shares are; Garden City 30MW, Gardner 20MW, Ottawa 5MW, Russell 5MW, and Lindsborg 2MW. Those in the photo who took the tour are Paul Mahlberg KMEA Staff, Matt Allen City Manager Garden City, Neal Daney KMEA Staff, Mike Muirhead Public Utilities Director Garden City, Duane Banks Electric Utility Director Russell, John Quinday City Manager Russell, and Mayor Melvin Dale Garden City. Everyone enjoyed the informative tour which lasted more than an hour. Dogwood Energy Facility is a 650MW combined cycle gas turbine electric generating plant located near Pleasant Hill, Missouri.

City of Chapman Department Heads Serve Lunch to High School Students

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City of Chapman department heads served lunch at the Chapman High School on October 10th as part of National School Lunch Week October 9-13.
City Administrator John Dudte
City Clerk Erin Tilton
Public Works Director Bobby Kamm

Public Power Week October 1 – 7, 2017

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Public power utilities across the U.S. celebrate Public Power Week the first full week of October every year to help customers and stakeholders understand how they can better engage with their community-owned utility and benefit from all its offerings.

American Public Power Association member utilities can use sample resources and templates to spread the word and help celebrate in your communities. https://www.publicpower.org/index.php/event/public-power-week

 

What’s in Your Electric Bill?

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Read more

Got Wind?

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Neal Daney, Director, Projects & Asset Management

The clock continues to tick to be eligible for a full value Production Tax Credit (PTC) wind project.  With the PTC’s, especially full value, wind developers are able to offer very competitive pricing terms.  The phase-down schedule is as follows:

 

  • Wind projects that started construction in 2015 and 2016 receive a full value PTC of 2.4 cents per kilowatt hour.
  • For projects that began construction in 2017, the credit is at 80% of full value.
  • In 2018, 60% PTC value and in 2019, 40% PTC.

 

The KMEA staff has identified an existing wind project that has full value PTC’s and competitive long-term pricing.  If you are interested in renewables or interested in a low cost energy hedge for a portion (5-20%) of your communities load, it is not too late to participate.