U.S. crude oil imports decline
While U.S. total net crude oil imports fell during 2013, the share of imports last year from the United States’ top three foreign oil suppliers – Canada, Saudi Arabia, and Mexico – was the highest in at least four decades, according to preliminary annual trade data from Energy Information Administration's Petroleum Supply Monthly report. These three countries provided almost three out of every five barrels of oil imported into the U.S. market last year.
U.S. net crude oil imports in 2013 declined 10.2 percent to 7.6 million barrels per day (bbl/d), the lowest level since 1996, as rising domestic crude oil production cut into the volume of imports needed to meet refinery demand for crude oil, according to the EIA.
The overall decline in U.S. net imports has led to an increasing concentration of net imports from Canada, Saudi Arabia, and Mexico. Combined net oil imports from these countries decreased by 1.5 percent last year. As a result, the 4.6 million bbl/d of oil supplied by these three countries accounted for 61 percent of total U.S. net oil imports in 2013, up from 55 percent the year before and their biggest share since at least 1973.
These countries generally produce medium to heavy, sour crude oil that is desirable to U.S. refineries, while increasing U.S. crude oil production from tight oil formations is typically of the light sweet quality. Also, with the exception of Saudi Arabia, these countries are near the United States, with Mexico having a short shipping distance for its oil to the large number of refineries along the U.S. Gulf Coast.
Canada, Saudi Arabia, and Mexico have consistently been America's three largest crude oil suppliers, although their rankings vary from year to year. Highlights from the top three sources for U.S. crude oil imports in 2013:
- Canada. Crude oil imports averaged a record 2.5 million bbl/d, up 3.9 percent from 2012. Canada has few other outlets for Alberta’s rising heavy crude oil production, so most of it is exported to the United States.
- Saudi Arabia. Crude oil imports averaged 1.3 million bbl/d, down 2.6 percent, but still the second highest in five years. Through its Motiva Enterprises joint venture, the country's state oil company is a partial owner of three large U.S. Gulf Coast refineries that it partially supplies with Saudi crude.
- Mexico. Crude oil imports of 850,000 bbl/d were down 13 percent and the lowest in more than 20 years, reflecting the continued decline in Mexico's crude oil production. Still, Mexico produces significant amounts of heavy crude that is well-suited to run in U.S. Gulf Coast oil refineries.
Source: U.S. Energy Information Administration
Ofwat allows retailers to raise prices from April
Retailers can recover a portion of excess bad debt by temporarily increasing prices from April 2022, according to an Ofwat statement.
The regulator confirmed its view that levels of bad debt costs across the business retail market are exceeding 2% of non-household revenue, thereby allowing "a temporary increase" in the maximum prices. Adjustments to price caps will apply for a minimum of two years to reduce the step changes in price that customers might experience.
Measures introduced since March 2020 to contain the spread of Covid-19 could lead to retailers facing higher levels of customer bad debt. Retailers’ abilities to respond to this are expected to be constrained by Ofwat strengthening protections for non-household customers during Covid-19 and the presence of price caps.
In April last year, Ofwat committed to provide additional regulatory protection if bad debt costs across the market exceeded 2% of non-household revenue.
Georgina Mills, Business Retail Market Director at Ofwat said: “These decisions aim to protect the interests of non-household customers in the short and longer term, including from the risk of systemic Retailer failure as the business retail market continues to feel the impacts of COVID-19. By implementing market-wide adjustments to price caps, we aim to minimise any additional costs for customers in the shorter term by promoting efficiency and supporting competition.”
There are also three areas where Ofwat has not reached definitive conclusions and is seeking further evidence and views from stakeholders:
- Pooling excess bad debt costs – Ofwat proposes that the recovery of excess bad debt costs is pooled across all non-household customers, via a uniform uplift to price caps.
- Keeping open the option of not pursuing a true up – For example if outturn bad debt costs are not materially higher than the 2% threshold.
- Undertaking the true up – If a 'true up' is required, Ofwat has set out how it expects this to work in practice.
Further consultation on the proposed adjustments to REC price caps can be expected by December.
"While it’s great that regulators are helping the industry deal with bad debt in the wake of the pandemic, raising prices only treats the symptoms. Instead, water companies should head upstream, using customer data to identify and rectify the causes of bad debt, stop it at source and help prevent it from occurring in the first place," she said.
"While recouping costs is a must, water companies shouldn’t just rely on the regulator. Data can help companies segment customers, identify and assist customers that are struggling financially, avoiding penalising the entire customer in tackling the cause of the issue."
United Utilities picks up pipeline award
A race-against-time plumbing job to connect four huge water pipes into the large Haweswater Aqueduct in Cumbria saw United Utilities awarded Utility Project of the Year by Pipeline Industries Guild.
The Hallbank project, near Kendal, was completed within a tight eight-day deadline, in a storm and during the second COVID lockdown last November – and with three hours to spare. Principal construction manager John Dawson said the project helped boost the resilience of water supplies across the North West.
“I think what made us stand out was the scale, the use of future technology and the fact that we were really just one team, working collaboratively for a common goal," he said.
Camus Energy secures $16m funding
Camus Energy, which provides advanced grid management technology, has secured $16 million in a Series A round, led by Park West Asset Management and joined by Congruent Ventures, Wave Capital and other investors, including an investor-owned utility. Camus will leverage the operating capital to expand its grid management software platform to meet growing demand from utilities across North America.
As local utilities look to save money and increase their use of clean energy by tapping into low-cost and low-carbon local resources, Camus' grid management platform provides connectivity between the utility's operations team, its grid-connected equipment and customer devices.