June 27, 2011 

Electricity Prices Take a Breather

The unpleasant summer heat in springtime roiled the electricity markets as you can see in the chart below. Prices have fortunately subsided due to normal temperatures and steady natural gas storage injections. Today, all major ISO Day Ahead Prices are below $55.00 per MWH.

Energy Efficiency Series

Main Tire Exchange Shows How To Go Green

In a recent Tire Review article, titled "Letting Green Take Root", Tim and Jon Shay of Main Tire Exchange of Buffalo and Dansville, NY, revealed how they applied sustainability and energy efficiency tactics to their company. The article also features tips from several other companies that have decided to get greener. We have excerpted a section below that discusses our LightSavers' efforts in Main Tire Exchange's greening process:

The Single Project
Meanwhile, Jon Shay focused his green eye toward new, energy-efficient and brighter lighting systems at Main Tire’s three locations. While the Shays invested more than $50,000 in the project, the estimated annual savings is about $10,000, with another $650 a year in maintenance savings. The return on their investment won’t take long.

Jon Shay says the project’s success is in part due to the involvement of Power Management Co., whose Light Savers Energy Efficiency program guided them through the process. The Victor, N.Y.-based company presented the Shays with lighting options, cost analyses, savings projections and other information that helped them make the best decisions for their dealership.

Among other things, Power Management touted the permanent reduction of lighting system energy consumption by half, and total electric utility costs by between 10% and 25%. It also promoted the improvement of facility illumination while reducing lifecycle maintenance costs. And, the company said, the permanent reduction of 100,000 kwh from a facility’s energy consumption results in the elimination of 32 tons of CO2 from the atmosphere. It also reduces a dealership’s carbon footprint while reaping a return on its investment.

“Power Management was very helpful from the outset,” Jon Shay says. “They came in, surveyed the different locations and created drawings showing how multiple fixtures could be replaced by just a single fixture. During the actual installation process, they would work around our peak production times so as not to create any disruptions. The entire installation in our three buildings was done much quicker than I imagined it could be.

“The lighting is much brighter, and we were able to replace fixtures on about a two-to-one ratio,” he adds.

Government incentives to save energy – which, in Main Tire’s case, was a rebate from the state of New York – encouraged the Shays to install the new fixtures, but Jon Shay says he would have completed the project even without them. “We have always been somewhat green-driven, so when we became aware of the rebates connected with the program, we went for it,” he says. “But even if the rebates weren’t available, it’s an absolute no-brainer.”

(Source: "Letting Green Take Root" was written by Joanne Draus Klein. if you are wondering how to go green, it is well worth reading in its entirety. Tire Review; June 14, 2011 )

Natural Gas Prices Decline As Temperatures Return to Normal

Last Friday, the price for the NYMEX front month was trading down 6% to $4.227 per mmbtu, when compared to prices two weeks ago. The cause of the decrease is related to lower temperatures across the Midwest and Eastern US.

Natural Gas Futures

CME-NYMEX natural gas futures market intraday prices for June 27, 2011 at 9:25 AM
(Prices are USD per mmbtu)

Jul. -   $4.227 -$0.002
Aug. - $4.242 -$0.008
Sep. - $4.242 -$0.008
Oct. - $4.308 -$0.011
Nov. - $4.443 -$0.011
Dec. - $4.630 -$0.015
Jan. - $4.730 -$0.020
Feb. - $4.722 -$0.022
PMC 30-Day Natural Gas Futures Chart

Natural Gas Storage Increases by 80 BCF

Working gas in storage was 2,354 Bcf as of Friday, June 17, 2011, according to EIA estimates. This represents a net increase of 98 Bcf from the previous week. Stocks were 258 Bcf less than last year at this time and 64 Bcf below the 5-year average of 2,418 Bcf.

Crude Watch

Light Sweet Crude (WTI) is trading today on the CME/NYMEX market at $90.277, down $0.89 at 9:05 AM.
 OPEC Basket Data

Interesting Links and Resources

(Click on Links to View)

Jeremy Grantham Warns of Paradigm Shift for Commodities (GMO Article)

Truth About Fracking   (WSJ, June 25, 2011)

SEC Shift Leads to Worries of Over Estimation of Natural Gas Reserves (NYT, June 27, 2010)

Weather Trends
The National Weather Service's Forecast indicates warm weather ahead for much of the Western and Southern states. The Midwestern and Northeastern states will have seasonal temperatures.

6-10 Day forecast
8-14 Day forecast
NOAA Forecast- 30-Days
El Nino-La Nina (Pacific Ocean Temperature Levels)
Arctic Oscillation (Arctic Pressure Patterns)
Jet Stream Forecast (SFSU)