What will natural gas prices look like over the next 40 years?
Well, over the past 20 years, prices recorded at the dominant Henry Hub distribution center in Erath, LA, ranged from a low of $1.05 per million Btu to a high of $18.48. Over the past 10 years prices ranged from $1.46 to $13.31.
The current price is $2.60. Forecasts show prices rising over the next two decades, but they vary in pace and amount. The U.S. Energy Administration projects natural gas prices through 2040 using multiple scenarios that encompass demand, supply, exports, and various consumption projections. Its latest forecasts indicate prices may remain below $4.50 or jump as high as $9.20.
The only knowable thing about natural gas prices is they are volatile.
When Mississippi Power Company proposed its Kemper lignite plant to the Public Service Commission (PSC) over a decade ago, traditional coal-fired plants were under attack by environmentalists and EPA and natural gas prices were high, averaging $7.81 at Henry Hub from 2005 through 2008. The company and the commission deemed it prudent for Mississippi Power to pursue an alternative fuel source for its next baseload power plant. The alternatives were nuclear and clean coal. Given Mississippi's vast, cheap lignite deposits, the clean coal alternative was chosen.
All know what happened next. Shale oil discoveries dramatically ramped up gas supplies, driving down prices. And the costs to build the lignite plant skyrocketed.
Over the next several months, PSC commissioners will be tempted, and politically pressured, to gaze into a crystal ball and guess what natural gas prices will be over the next 40 years. That's because the lignite plant will soon come fully online and the commission has linked the "viability" of the plant to natural gas prices.
Yes, the technology works. Syngas produced from lignite coal has powered electricity generation which has been delivered to Mississippi Power customers for weeks now. Carbon dioxide has been sequestered, sulfuric acid produced, and both delivered to downstream users.
The final hurdle for the plant to come fully online is for both syngas turbines to operate simultaneously for a specified period of time.
When it does, the company will ask commissioners to approve rates to allow recovery of costs for building and operating the multi-function facility. Building costs for the power plant were capped at $2.8 billion. Another $1.4 billion was authorized for the CO2 pipeline, the coal mining operation, and limited other items. Allowable operating costs have yet to be determined.
How much cost to allow Mississippi Power to recover from ratepayers will be the great challenge for our elected commissioners. Politicians tend to focus on the moment. Utility companies must focus on multiple decades. That's why major power generators have diversified baseload fuel supplies. History has shown reliance on a single fuel source over time to be imprudent.
So, the real analysis facing commissioners is not what natural gas prices may do, but how much rate payers should invest to provide Mississippi Power necessary and prudent fuel diversification.
Crawford is a syndicated columnist from Meridian (crawfolk@gmail.com)
Saturday, March 18, 2017
Bill Crawford: Fuel Diversification is Real Kemper Issue for PSC
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Trollfest '09
Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.
Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).
Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.
Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".
In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.
In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.
Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.
Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!
This is definitely a Beaver production.
Note: Security provided by INS.
Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).
Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.
Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".
In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.
In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.
Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.
Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!
This is definitely a Beaver production.
Note: Security provided by INS.
Trollfest '07
Jackson Jambalaya is the home of Trollfest '07. Catch this great event which promises to leave NE Jackson & Fondren in flames. Sonjay Poontang and his band headline the night with a special steel cage, no time limit "loser must leave town" bout between Alan Lange and "Big Cat"Donna Ladd following afterwards. Kamikaze will perform his new song F*** Bush, he's still a _____. Did I mention there was no referee? Dr. Heddy Matthias and Lori Gregory will face off in the undercard dueling with dangling participles and other um, devices. Robbie Bell will perform Her two latest songs: My Best Friends are in the Media and Mama's, Don't Let Your Babies Grow up to be George Bell. Sid Salter of The Clarion-Ledger will host "Pin the Tail on the Trial Lawyer", sponsored by State Farm.
There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.
If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!
This is definitely a Beaver production.
Note: Security provided by INS.
There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.
If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!
This is definitely a Beaver production.
Note: Security provided by INS.
20 comments:
One of the very few well written, well reasoned articles about Kemper. Not the populist Bigger Pie natural gas investor based article; not the I hate the politicians, lets bash them all approaches; and not the Southern Company is our great utility defense. PSC has a responsibility to do the job of determining prudence which includes having to look at costs over decades, not until the next election. Good job, Crawford
Gimme a break. Crawford is in the tank for Kemper. Only water carrier bigger is Haley Barbour.
2:05 Please read 1:37 comment
2:05 -- that's you in 1:37's comment, in case you don't recognize yourself.
"not the I hate the politicians, lets bash them all"
Thanks for chiming in - you represent your group well.
abolish the PSC and the market will sort it out
Kemper Clean Coal is all sunshine and rainbow farts until the price of gas goes above 10.00/MBTU. At which point we will find out what the availability of the magic lignite coal gasifier scrubing collection process really is. Anyone want to bet that it will have more suck than a black hole?
Meantime Bill Crawford previously bloviated on Mississippi Republican politics and waxed nostalgic for the days of Haley and sons' principled lobbying and governing.
BILL CRAWFORD: Responsible governance has had its day in Mississippi
Posted on April 24, 2016 by Daily Journal in Opinion
BILL CRAWFORD
BILL CRAWFORD
Bless their hearts. They did the best they could.
After taking care of themselves, political promises, and lobbyists, there just wasn’t much Republican legislators, with their new super-majority in the House and Senate, could do to take care of Mississippi’s real needs.
At least it certainly looks that way.
House Republicans kept their money train fueled by special interests and lobbyists on track.
...
Another unaddressed real need is the growing fiscal crisis. Just after Republican legislators adopted its huge tax cuts, Gov. Phil Bryant ordered additional mid-year budget cuts and another raid on the state rainy day fund. Couple these with legislators depending once again on one-time money to balance the budget and you see the state’s sound fiscal foundation starting to crack. Aggravating the problem, insiders say spending bills just passed will exceed next year’s revenue by $150 to $200 million. And that’s before the new tax cuts kick in.
Yes, it seems clear, the politics of self-interest and special interests now dominate the Republican dominated Legislature. Responsible governance, espoused by the early fathers of the modern Republican Party in Mississippi and championed by former Gov. Haley Barbour, has had its day.
KIOR, BEEF PLANT, KEMPER, that kind of fiscal nonsense all got in high gear just as soon as Haley's term ran out. Right?!
Why should ratepayers pay for fuel diversification? They should get the cheapest fuel prices possible. If fuel prices go up, let the people who are buying power THEN pay for it. This notion that some people have to pay now so that some people don't have to pay later is pure speculation. Let it happen as it happens.
Damn 6:12, with that kind of forward thinking we should put you in charge. That way, utilities won't have to build any back-up plants to supply electricity Might be a problem when one goes down for needed repairs, or some natural disaster - at that point the utility will have to start construction of a new generating plant. Might leave you out of electricity for a few years until it gets built, but for all those years until the back-up is needed, you want have to be paying for the extra capacity.
Southern Company made a huge gamble by building this experiment and putting on the back of its smallest utility. PSC also needs to look at how this plant affects rates and stifles economic development. Mississippi has a over supply of electricity as is. Nobody ever mentions Plant Sweatt (owned by MPC and idled the majority of the time) located just south of Meridian; or the plant in Enterprise that was built and dismantled due to low energy costs. The thing should never have been built, but now it's here and the PSC must limit the damage to the ratepayers.
3:20 & 3:46 snowflakes. Read 1:37. Self-serving bullshit. Bill Crawford is BarbourSouthernCoMPCKemper shill. Has been fm GETGO. Get over yourselves. Crawford using same nat gas price fuel diversification BS that Bogg Hogg uses. PLUS Henry Hub hasn't been "dominant" for long time. That's Crawford journo thinking he's some sort of exxxppperrrtttt. He ain't. Kemper has been scam since the 2793 drawing board. Lynn Posey complete idiot too. Go find your safe space now.
Crawford=Boar Hind Tit
Is Kingfish paying Crawford to come up with this bullshit or is Crawford paying Kingfish to publish his bullshit?
Here is the latest on Kemper just out. Read it and weep Bill. The rats are leaving the SS Kemper:
https://www.desmogblog.com/2017/03/17/brain-drain-engineers-and-managers-flee-southern-company-troubled-kemper-clean-coal-plant
So at what point are Bill Crawford and Barbour not willing to burn more money on the pagan altar of fuel diversification? $7.1 Billion enough? The truth is that it was the job of SO/MPC to understand that fracking had brought a paradigm shift to the natural gas market by 2010 and that natural gas prices, as the EIA has forecast, will not recover during the 40 year life of the plant if it ever reaches the Commercial Operating Date (COD). Further SO is just on the verge of blowing through the the June 3 "firm" date to both open and file a rate case on the coal gasification plant so they can ask the MPSC for $4.1 Billion. Then what will Bill Crawford have to say?
For $7 billion they could have acquired or built dozens of natural gas facilities or hundreds of wind and solar farms which would have generated more electricity than could ever be used for the entire state. It would have been highly profitable to have gone that route but they made a bad choice.
Wind or solar farms can not be used as a baseload plant. This is the same kind of argument BPF has tried to sell, comparing Kemper with other secondary plants. A baseload plant is one that will be a primary source, capable of operating and providing the required electricity 24/7/365. A natural gas plant would not meet the purpose of diversification. What could have been done that would meet the need was a nuclear plant - but getting one approved in today's climate, especially in the Obama administration years - was not going to happen.
Actually Southen Compqny is nearly complete on 2 nuclear reactors in Georgia. Built with plenty of incentives from the Obama administration. First reactors built since Three Mile Island.
8:51: A base load plant is required to be reliable 52/365. Kemper can't get there without the spending of hundreds of millions more over another period of many months. So just how many more dollars and skulls do you want to burn on the pagan altar of diversification to make that happen? And what do you propose doing on June 4 when the plant still isn't at COD and, if it ever opens, at any case is too expensive to operate and maintain as a coal gasification plant (employing 200 people to run it instead of 20)? The MPSC will walk away at that point and leave SO to continue to run the plant on NG and take its loss instead of their constituents. The good news is that SO makes tens of Billions a year and can and will take the hit.
Rate payers are NOT investors. They are consumers. The investors , who assume the risks and benefit from the profits, are supposed to take the losses and gains.
If Kemper were a good investment, they wouldn't have needed taxpayer money. Their stock holders would be happy and their stock would go up in anticipation of future success.
This notion of using tax dollars to pay for business start ups would be tolerable if taxpayers received a dividend when profits were made. We don't. We just get burdened with the costs.
SO needs to be ready to write off the $4.1 Billion instead of asking innocent ratepayers to pay for for their failed experiment.
March 18, 2017 at 6:06 PM
don't forget to add the now closed 93 million dollar Walnut Grove Correctional Facility that was closed in September. It sits empty and for 17 years the State of Mississippi has only paid interest on the debt. So the list now is ...
WGCF, KIOR, BEEF PLANT...and KEMPER
That giant sucking sound....get's louder and louder..
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