U.S. supports increased oil and gas production
The Obama Administration's support for increased domestic oil and gas production does not conflict with its goals of addressing climate change and lowering greenhouse gases, according to U.S. Energy Secretary Dr. Ernest Moniz.
“We remain committed, even as we produce much more oil, to lessening our oil dependence, using less oil domestically and having fewer emissions,” Moniz said.
The Secretary made his remarks before an audience of more than a hundred energy executives, government officials and other industry representatives in a keynote address at the 2013 Platts Global Energy Outlook Forum Thursday in New York City, which annually convenes industry experts to detail and debate the challenges, opportunities and special issues facing the world's energy companies and policymakers.
The U.S. remains a major importer of crude oil, Moniz said, and the Obama Administration is taking aim at reducing those imports through efficiency measures and investments in alternative fuels and vehicle electrification.
Titled “Bridging the U.S. Boom: Global Markets Prepare," this year's forum focused on the continuing ripple effects of the U.S. shale revolution, which Moniz said once again cast the nation as an "energy powerhouse.”
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“What we are seeing now is that some new technologies – without government subsidies – are getting mature enough to make it into the mainstream,” said Wal van Lierop, president and CEO, Chrysalix Energy Venture Capital. “We will continue to see more of this in years to come.”
With the U.S. awash in domestically produced oil, it may be time for the U.S. to review its ban on exports of crude, but the Department of Energy has no immediate plans to change the composition of or to sell off any part of the Strategic Petroleum Reserve, said Moniz, at a post-forum media briefing.
The U.S. has experienced a boom in crude production in places like North Dakota, and pipelines that once took crude from the Gulf of Mexico up to the Midcontinent have now been reversed to bring Bakken crude oil south, leading to questions about whether the Strategic Petroleum Reserve can effectively and efficiently deliver oil to where it's needed most in a crisis.
Earlier, in the Forum's first panel, Leonhard Birnbaum, chief commercial officer of Germany-based E.ON, said he does not see shale gas being a game-changer in Europe the way it has been in the U.S.
Birnbaum said Europe lacks the regulatory environment and infrastructure to significantly tap into its shale gas resources. In addition, he said, Europe does not have the robust oil services industry and pipeline systems that the U.S. has. Also, environmental opposition to fracking is high in Europe.
“It's hard to imagine it's going to take off fast,” Birnbaum said. “For the next 10 years, it's not a game-changer. The advantage of the U.S. on the gas side and the power side is quite sustainable.”
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.