RD Energy Newsletter: June 2018 For Granville, Ohio Residents

June 2018 Energy Update

Key Drivers

  1. Natural gas NYMEX is up for the third month in a row to $2.95/MMBTU
  2. Natural gas prices are up $.25/MMBTU in the past 30 days
  3. Supply/Demand balance week ending May 31: Supply of 85.7 bcf/day – demand 72 bcf/day = 13.7 bcf/day injected into storage
  4. Hot weather will increase power demand of natural gas
  5. Key question: Will the storage deficit be gone before winter if demand continues to increase faster than new supply?



Summer begins!  The summer of 2018 begins in June with a 788 bcf natural gas storage deficit below a year ago and 500 bcf behind the 5 year average.  While natural gas production is at record levels, natural gas demand continues to rise as well.  LNG exports as well as exports to Mexico continue to increase.  Summer weather will be the key driver with increasing power burns and thus increasing natural gas usage as temperatures heat up.  Some forecasts like NOAA expect the summer to be warmer than normal.  Other forecasts range from warmer than normal to cooler than normal in July and August.  Those predicting a cooler July and August expect a weak El Nino to start.

PJM Capacity rates for will be increasing June 2018 – May 2019 and then drop the next two PJM years.  However, the capacity costs were just released for the 2021-2022 PJM year and they will rise again.  Those in the Demand Response and Peak Load Management programs can have a financially rewarding year.  We always recommend medium to large electric consumers to explore these two programs and make sure they are implementing a total energy purchasing strategy.  Peak Load Management, Demand Response programs and looking ahead at forward wholesale market price opportunities, even a year or two ahead of your current contract end date, makes for a healthy start to a strong overall energy buying strategy to reduce costs and provide protection against price spikes.  There are many factors both domestically and globally that can effect wholesale natural gas and electric prices.

Part of our RD Energy customer “wellness” plan is to meet customers each summer.  If you would like to get on our schedule this summer, please let us know and we’ll coordinate a time convenient to you.
Remember that we post energy related articles each month that we feel are interesting and enlightening.   Find these articles  on our Facebook page: https://www.facebook.com/rdenergypricechoice/.

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