Vice President of Procurement
As many of you are aware from watching the news, the global energy situation has been at the forefront of discussions for the past several months. What is occurring in Europe is significantly impacting energy prices in the US and, more importantly, New England. We’ve all watched the effects on oil, natural gas, and gasoline prices. In addition, utility electricity prices are at levels never seen before, all based on a futures market related to supply.
In New England, we have a more significant concern as we head into winter. Our heavy dependence on natural gas for electricity generation is compounded in the winter months with the need for LNG (Liquified Natural Gas) to supplement any shortfalls in natural gas supply.
New England feels a greater impact on electricity pricing in the winter because generators compete for natural gas supply with heating requirements. ISO-NE, the grid operator, has been planning for potential scenarios and utilizing a rolling three-week energy supply forecast to reduce risks, including monitoring certain variables like weather forecasts, energy supplies, and expected consumer demand. Their goal is to help prevent energy emergencies by providing generators through forecasting with the ability to evaluate their fuel supplies.
The severity of the Winter conditions/temperatures will dictate electricity prices, supply, and reliability. So, what can we expect for temperatures in December, January, and February? Several factors dictate our weather and are studied by the National Oceanic & Atmospheric Administration (NOAA) to provide forecasts that include:
- El Nino – Warmer waters cause the Pacific jet stream to move south of its neutral position, causing northern areas to be warmer than usual.
- La Nina – Opposite El Nino, colder waters push the jet stream northward, causing colder temperatures in the north and warmer in the south. New England generally experiences milder than normal conditions.
- Polar Vortex – Low Predictability – Large cold air surrounding the North and South Poles. If the vortex in the northern hemisphere expands during the winter, as it often does, it sends cold air southward with the jet stream.
NOAA’s Winter 2022-2023 Outlook
- La Nina returns for the third consecutive winter, driving warmer-than-average temperatures along the eastern seaboard into New England. Chart 1
- NE projected at 40% to 50% chance of above normal temperatures. Chart 1
- Equal chance for below, near, or above average precipitation for New England. Chart 2
- Predictions can change! NOAA revises the Outlook monthly toward the middle of the month. Current data issued on November 17, 2022.
ISO-NE’s Winter 2022-2023 Outlook
- NE should have adequate electricity supplies under mild and moderate weather conditions.
- Prolonged periods of very cold weather continue to pose reliability risks to the region, but ISO (Independent System Operator) New England will use procedures and plans, including a rolling three-week energy supply forecast, with the goal of mitigating these conditions should they materialize.
- The ISO does not anticipate calling for controlled outages and would only use this drastic step as a last resort to prevent a collapse of the power system.
- ISO New England anticipates demand for electricity will peak at 20,009 megawatts (MW) during average winter weather conditions of 10°F and 20,695 MW if temperatures reach below-average conditions of 5°F. These projections are both about 2 percent higher than last year’s forecasts.
ISO-NE’s 2022-2023 Winter Outlook Data
- Winter peak forecast: 20,009 MW under normal weather conditions; 20,695 MW under below-average conditions.
- Last winter’s demand peaked at 19,756 MW on January 11, 2022, when temperatures averaged 10°F.
- The all-time winter peak demand is 22,818 MW, set on January 15, 2004, during a cold snap.
- All-time peak demand: 28,130 MW on August 2, 2006.
- Resources with a Forward Capacity Market (FCM) capacity supply obligation to be available: 30,145 MW.
- Total resources – 34,103 MW.
- Natural-gas-fired generating capacity at risk of not being able to get fuel when needed- more than 4,100 MW.
Items to Consider Regarding NOAA’s Forecast and the Polar Vortex
- Even with above normal temperatures forecast for New England this Winter, a weak Polar Vortex can cause drastic temperature swings.
- A weak Polar Vortex can also result in blizzards & nor’easters across NE, even late in the season.
- The average temperature in Winter 2017-18 was above normal, yet the season saw both record warmth and severe record cold.
- Arctic Outbreak December 24, 2017 – January 8, 2018: 14 consecutive days of below normal temperatures across NE.
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