Natural Gas
In The News – Avalon Energy Services
Avalon Energy Services recently completed an electricity procurement project for KBS Capital Advisors’ One Washingtonian Center property in Gaithersburg, MD. Marc Deluca, Regional President of KBS, noted that “Electricity markets have exhibited extreme volatility. The folks at Avalon Energy Services have deep expertise and an unsurpassed understanding of the energy markets and how they work.…
Read More40% Reduction and Volatility Avoided
Our recent press release was picked up by numerous news outlets. Click here to see how it was reported by the Wall Street Journal’s Market Watch. In summary, Avalon Energy Services, LLC and our project partner, Ameresco, successfully completed a second natural gas procurement process for the District of Columbia Department of General Services (DC…
Read MoreMarket Update, November 6, 2013
For buyers, pricing in the wholesale natural gas market is attractive. The graph below shows natural gas prices over the past ten years. While we are not at the absolute low, we are near the bottom. The next graph shows the 24 month forward curve for natural gas. The line is upward sloping, meaning the…
Read MoreReal Energy Cost Savings
Below are the results from a sampling of reverse auctions conducted for Avalon Energy Services’ customers, including customers of varying size, over the past few months. The first graph shows the customer’s annual energy costs before competitive bidding (blue line) and after contracts were executed on accepted bids (red line). Pre-auction annual energy costs ranged…
Read MoreBest Friends? – Natural Gas and Electricity Prices – An Update
By David White In a post from January 2012, the declining correlation between the price of natural gas and the price of electricity was explored (click here). At that time, the correlation between the two was declining as a result of the greater recovery in electricity prices relative to those of natural gas. The graphs…
Read MoreNatural Gas Prices – Time to Hit the Panic Button?
Over the last 25 days, the daily spot price of natural gas at the Henry Hub has risen more than 30%. This is a dramatic percentage increase over a short period of time. Is it time to hit the panic button? No. In short, the percentage increase is so large because the base has gotten…
Read MoreLong Tailed Fish Swimming East
Markets adjust. There are perhaps few better examples of that adage than the crude oil and natural gas markets. One way of looking at how these two markets adjust is through the rotary rig count. Baker Hughes keeps track of the number of active drilling rigs in the US (and also internationally). Since July 1987,…
Read MoreCrude Oil and Natural Gas Move to Different Hemispheres
On December 16, 2011, we looked at the relationship between natural gas and crude oil prices (see “Crude Oil and Natural Gas Get a Divorce” here). We looked at how historically, on an energy equivalent basis ($/mmBtu), crude oil (West Texas Intermediate at Cushing, Oklahoma) traded at about a 50% premium to natural gas at…
Read MoreNatural Gas Prices Continue to March Down
March is the last month of the five month winter heating season. As of March 30, the level of US working gas in storage was 2,479 BCF. This is an increase during a time of the year when natural gas is historically withdrawn from storage, not injected. The March 30 level is 927 BCF, or…
Read MoreEnergy Prices Always Go Up (continued)
As discussed on this blog, there is a common perception that energy prices have been, and continue to be, on a one way path upwards. In previous posts we focused on natural gas and showed that rather than rising, natural gas prices have, in fact, fallen dramatically, over both the short run and the long…
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