Thursday Fundies – Flood Control Update

Good Morning,

The USACE released its first flood control update of WY18 this week. We found it to be not much of a surprise, we didn’t expect a GCL draft with a 40′ handle, but that is what we got:

In the above table, we summarized all of the COE’s releases since 1998 and filtered on Coulee, Jan (release date) and April End. The target, as of this week, for Coulee’s draft is 1248, or about 33′ between now and April 30. Not an insignificant amount of water, let’s see when its scheduled to be pulled:

Hah! All of it in that red-headed stepchild of a bullet known as April. BPA can do as it pleases with the pond until then, but don’t think you’re off the hook; Coulee will pass all upstream drafts between now and then which includes Mica, Duncan, Libby, Horse, and Arrow. In other words, Coulee becomes a large run-of-river plant between now and April 1. Check out the tool to run your queries, lots of useful nuggets to be panned from that report. We typically drop in the latest the same day or next day.

Gas Review

Though we dedicate the Friday blog to gas, I like to wander through the reports as the commodity is such an important one. A few of those caught my eye this morning.

We mentioned last week how Rockies Production had become the East Coast’s new storage plant; check out those swings. Suggests lots of unused capacity and speaks to how bearish natty truly is.

Still, love gas? Socal had close to its most significant injection in a year yesterday, and TWP isn’t even half full at Needles. I guess that is why SCGC spot tanked back to reality:

Now all the WECC gas hubs are stuck in the muck of a $2 handle rendering naked power price upside as likely as a united Congress.

Our LDC Index of demand further confirms the abysmal state of the west gas markets; nearly every zone’s demand is down.

Flows at GTNW were odd of late, collapsing to next to nothing, then surging back. Not sure what’s going on there, but that’s what happened; it undoubtedly wasn’t driven by demand North of Malin, nor was it driven by Power demand:

This market feels very tippy toppy, and we’re starting to see cracks in the SP LMP clears (HA, at least):

Those the lowest string of HA hours since last Winter, but cold weather is approaching, so you bears might consider hibernating in those caves for a few more weeks.


Well, cold might be a bit of an exaggeration, at least in LA where the new definition of “cold” is just getting down to normal.

The Northwest has genuine coolish weather, but not this week; in fact, it seems we’ve been saying those same words for the last two months “next week gets colder.” Reminds me of those utility 20-year load forecasts, back in the day. Every year the prognosticators projected out loads at 2-3% – so they started building 5 WPPS nukes (only one ever want online). What was so singular about those 20-year forecasts was the starting point for each year. Had you drawn a line through the last ten years of those forecasts, they all started at the same place, meaning zero load growth. LOL.

Eastern WECC grows chilly out in the headfake days of 11-20, for now, its Al Gore’s hellish reality of warmer than average temps.


All the nukes are running, that’s bearish, but we’re starting to see ISO gas outages picking up:

The new year brought new outages; both planned and forced:

Some windy days are offsetting that reduction in gen capacity:

Despite the wind, the total renewable energy inside the ISO cratered, probably off of a fair amount of precip. Check out those Solar lows two days ago; talk about a volatile support resource.


For the next eight weeks, its all about snow. California doesn’t have any, and the Northwest does, but the anomalies are falling fast, though that decay should either decline or reverse off of the most recent precip outlook:

Big Mountain should enjoy Big Powder as Kalispell is pledged to receive an inch of cumulative precip over the next ten days, more than average. But that fair village is the only station that does get to normal, everywhere is else is projected to fall short. Net-net, we see today’s outlook as slightly dry.

The fair state of Kalistan is projected to get close to normal, but all of that falls next week, and the state of that state remains very dry.

That dryness is showing up in energy production; all indices point down.

2018 flows lack volatility and not worthy of mention, aside from the “max” line – that was last year’s flows; quite a contrast with this years, right?

Discharge at Arrow remains robust, the project is dumping nearly 100 kcfs into the Columbia, just above Coulee. Some of this is that flood control draft; the effect is to drive more energy out of GCL:

For now, the reservoir is unchanged, all of the Canadian largesse is passing through the turbines, which is why we are now calling the plant a “run of river”; sure, they have 10 feet of storage to play with, and could draft more if they want to, but we doubt we see that pond swing much over the next 10 or 11 weeks.


BPA added five days to next year’s DC outage yesterday; worth watching to see if more get added.

Most interesting of the flows is the USA to Canada exports; now BCH is a net buyer. That suggests either the Province is short (it’s not) or the MidC is cheap (it is), or the future is very bullish (it’s really not). Meanwhile, the Northwest is filling both its southbound lines regardless of the crappy ISO prices, which suggests prices in the Northwest are very weak (they are).

Check out the flows on Path 15 for an hour; they hit TTC, which suggests either NP was very short (it wasn’t) or ZP overscheduled its generation (it probably did).


Hints of cold weather next week, but we’ve grown numb to these headfake forecasts. Coulee’s discharge is now 140kcfs with no signs of abating, that is very bearish. The precip outlook is neutral, neither wet or very dry. The ISO is entering its biggest planned outage season but doesn’t need the capacity. Gas is abysmal. All of which gives us a slight bearish slant, but let’s look to the markets before deciding what to BUY or SELL.