2 min read

Your Business Needs a Whole Health Energy Plan

By 5 on February 26, 2021

Since the dawn of electricity deregulation, most commercial and industrial clients have relied on brokers and sales reps as their primary source of education and strategy development. Clients meet with a different set of sales people to discuss procurement, engineering, demand-side management, sustainability, and resiliency, leading to a fractured decision-making process and piecemeal strategies that lack depth, diversity, harmony, and foresight. When energy prices are falling, the weather is following normal patterns, and suppliers are offering low bids in a race to the bottom, any sales rep or broker running a simple procurement process can appear to be adding value to your business.

But what happens when your energy strategy never contemplated resiliency and rolling power outages quickly erode the bottom line while possibly damaging equipment and creating dangerous conditions? What happens when an overly simplistic energy strategy leads to contractual penalties or revenue limitations after adding an onsite generator or solar array behind the meter? What if the ROI on your energy efficiency project is based on poor assumptions, faulty logic or does not account for the unique attributes and tariffs in each market? What if the generator you recently installed does not meet the necessary standards to participate in economic demand response programs?

For too long, clients have been approaching procurement, engineering, sustainability, and resiliency as separate decisions from one another when, in fact, a synchronous approach is necessary to minimize the undue risks and maximize the opportunities and benefits that come with deregulation. It is time to pivot away from the siloed decision-making of the past and start implementing customized, comprehensive, Whole Health Energy Plans.

This holistic approach to strategic energy management encompasses every part of the energy value chain, from initial construction through procurement and usage optimization to complete grid independence, and everything in between. Each of the individual decisions are made in concert with one another while relying on the overarching strategy and guidance of a robust energy advisory firm, like 5.

Many of our clients are successfully executing on their Whole Health Energy Plan by leaning on 5’s intellectual capital and team-based approach to address the following:
• Construction services and site selection, including design and equipment considerations
• Energy efficiency projects and infrastructure upgrades, HVAC, lighting, and controls
• Client usage analytics, benchmarking, budgeting, tariff and tax auditing, local law reporting, EnergyStar, LEED, WELL Building, ASHRAE audits, and regulatory guidance
• Bill data management, metering, and submetering
• Customized procurement and on-going product management
• Demand response participation at the utility and/or ISO levels
• Power factor correction, coincident peak management, load optimization, load resource programs
• Renewable energy procurement, onsite solar, utility scale solar, renewable retail contracts, RECs, PPAs, VPPAs, carbon offsets, de-carbonization, wind energy, Green Hydrogen, and ESG master planning
• Resiliency plans with a diverse set of options, including distribution generation, microgrids, battery storage, fuel cells, CHP, and more 

The details of which programs are best for each client’s Whole Health Energy Plan depends on a complex set of variables. That is why client relationships begin with an in-depth review of operations and usage data along with a series of diagnostic meetings to best understand the client’s needs, risks, and opportunities. The agreed upon plans must be farsighted, while also adjusting over time to fit the evolving needs of the client, the utilization of new technologies, and the ever-changing dynamics of the market.

A well-designed Whole Health Energy Plan reduces costs, improves resiliency, enhances sustainability, and ultimately creates a competitive edge for our clients. Contact our team to discuss options for your Whole Health Energy Plan here.

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Topics: Markets Procurement Demand Response Sustainability Education
3 min read

Moments from Complete Failure

By 5 on February 26, 2021

From time to time, events occur that reshape and redefine an industry. These events can often prompt stakeholders, lawmakers and customers to question and reevaluate some of the basic premises on which an industry was built. This is the kind of event that happened across Texas during the week of February 15, 2021. While the power outages and the arctic temperatures sent shockwaves throughout the state’s energy markets, the personal toll was equally, if not more, devastating. Millions of Texans were without heat, electricity, and water for days where the thermometer struggled to climb above freezing. But, as is often the case, calamity brings out the best in people as neighbors came to each other’s aid to help wherever possible. And while this story will certainly be told and assessed through gigawatts, hertz and dollars, none of these units can begin to measure the human pain and suffering that was caused by this event.

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Topics: Markets ERCOT
4 min read

Near-Term Opportunities in '22 & '23

By 5 on February 26, 2021

Electricity prices in NYC are starting to show signs of consolidation. Earlier this winter, mild temperatures in the months of November and December placed downward pressure on both near-term gas and power futures prices. This can be seen in Figure 1, which shows wholesale forward electricity prices in NYC for calendar years 2022 through 2025. This market correction, which lasted through the end of December, created good purchasing opportunities for many in NYC. Since the beginning of the year, prices have rallied, increasing between 2.5% and 5.1% across all calendar years except 2023. Note the flat to downward slope of electricity prices for calendar year 2023 (black line). While near-term prices in 2022 have rallied, falling prices in 2023 and have produced a degree of consolidation and created good purchasing opportunities.

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Topics: Markets NYISO
3 min read

During Historic Cold Spell, PJM Keeps Its Cool

By 5 on February 26, 2021

PJM kept its cool last week as power markets in the midcontinent were struggling under the strain of record-setting energy demand due to a historic cold spell. Unlike what happened in Texas, grid reliability was maintained, and spot electricity prices remained under control. In PJM, the electricity futures market continues to trade sideways and largely rangebound between $26-30/MWh in the wholesale market across the entire region. Clearly, it will take more than wild weather to materially move this market.

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Topics: Markets PJM
3 min read

The Gas Price Rally That Never Happened...

By 5 on February 26, 2021

Valentine’s Day may warm our hearts, but it often coincides with some of the coldest weather of the winter, and this year was no exception. Last week, Valentine’s Day weekend was followed by Presidents Day, which means that gas traders must make their purchases for the long weekend on Friday to cover the next four days. The weather forecast on that Friday pointed to record cold temperatures across most of the midcontinent and extending into south Texas. The expectation of cold temperatures and high heating demand over the long holiday weekend started to produce volatility in natural gas markets as early as Friday afternoon.

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Topics: Markets Natural Gas
2 min read

Urgent Texas Electricity Update

By 5 on February 15, 2021

Conservation Needed

To all businesses and homes in Texas fortunate enough to still have power, please reduce electricity consumption throughout the rest of Monday and Tuesday. The Texas electric grid is experiencing unprecedented strain, and many have been without power since early Monday morning. You can help by reducing the setpoint on your thermostats, turning off and unplugging non-essential lights and appliances, closing shades and blinds, and avoiding use of large appliances (ovens, washing machines, etc).    

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Topics: Markets ERCOT Education
3 min read

February 2021 Weather & Market Update

By 5 on February 12, 2021

The entire mid-continent is bracing for an historic cold weather event over the next several days. In Texas, energy regulators, delivery utilities, and market participants are making advanced plans to keep the population safe and warm throughout this event. What's in store is not only an energy market issue but also a public safety concern as well. It goes without saying that electric power is a critical service in our modern lives and we should all take precautions against extended power outages over the next few days.

The near-term weather forecast in Texas is the coldest it's been in decades. The forecasted highs and lows for Monday and Tuesday could set numerous “all-time” lows across many portions of the state. These temperatures are likely to be 10ºF to 15ºF colder than February 2011, when ERCOT was forced to deploy rolling blackouts across the state to stabilize the grid.

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Topics: Markets ERCOT
2 min read

Cuomo's State of the State for Energy

By 5 on January 27, 2021

In his 2021 State of the State address on January 11th, Governor Andrew Cuomo declared the transition from fossil fuels to renewable energy as an opportunity for New York to stimulate the economy in the post-COVID world. Cuomo highlighted four components that need to be addressed simultaneously to seize the moment:

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Topics: Markets NYISO
4 min read

Rising Temps, Falling Prices

By 5 on January 27, 2021

The price for this winter’s natural gas has seen its fair share of volatility over the past 12 months. Coming out of last winter’s abnormally warm weather, prices for the 2021 calendar year strip saw its all-time low of $2.27 per MMBtu on Friday, March 6, 2020. This was the last trading session before the Saudi Arabia and Russia feud over cutting crude supplies at the beginning of the coronavirus pandemic. Since last March, natural gas prices saw two sustained bull markets where prices rallied more than 50¢, from April through May, and then again from late July through the end of October. These two rallies are highlighted in Figure 1.

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Topics: Markets Natural Gas
2 min read

More Meters in PJM "Get Smart"

By 5 on January 27, 2021

On January 8th, the New Jersey Board of Public Utilities (NJBPU) approved a new program that will allow PSE&G to spend $780M over the next four years to install smart meters in homes and businesses throughout its territory. This move is intended to create a more integrated network between customers and the electricity grid that will provide more transparency to price signals and ultimately help homeowners and businesses to make more informed energy decisions. These upgraded and improved meters will also provide near real-time outage detection and help customers to be more aware of their energy consumption.

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Topics: Markets PJM