Energy Systems Consulting Perspectives

Recently there have been calls for a ban on U.S. oil and natural gas production using hydraulic fracturing (also known as “fracking”), and several states have passed laws banning its use. To investigate such a policy initiative, the American Petroleum Institute (API) turned to OnLocation to provide quantitative modeling and analysis to determine the impacts of an outright ban on fracking. API chose OnLocation because of its reputation for respected and timely analysis of this nature.

On Friday February 28, the comment period for the regional Transportation and Climate Initiative (TCI) Draft Memorandum of Understanding (MOU) comes to a close. The TCI proposal would establish a regional program to cap greenhouse gas emissions from transportation fuels and invest in transportation projects to achieve additional environmental benefits. The program would cover more than 40 percent of greenhouse gas emissions from twelve TCI states and the District of Columbia. After the MOU comments have been compiled and incorporated into the proposal, a final MOU will be released, likely in the spring, for final approval by TCI states.

• Summary:

OnLocation Inc, a boutique Energy Consulting firm based in the Washington DC area, just closed a six months-long engagement designing a global integrated energy modeling system for one of the world’s largest oil and gas producers.  The integrated energy modeling platform will bring 12 (twelve!) disparate models together and act as a comprehensive simulation tool to run scenarios and identify risks and opportunities. Corporate planners will be able to study energy supply, demand, conversion, and macroeconomics and run scenarios through the models to test and validate assumptions by applying the diverse analytical power of operations research and econometrics to the energy flow.  

As part of our ongoing support for the U.S. Energy Information Administration (EIA) and other government agencies, OnLocation has been studying the potential impact of large amounts of solar generation on grid stability as it relates to the National Energy Modeling System (NEMS), as described in a previous blog dated May 25, 2016.  The issues stem from the timing of solar generation during the day, particularly in months when electricity demand is relatively low such as early spring before air conditioning is needed.  The potential impact on the grid from the high daytime solar generation on days with low electricity demand and the corresponding steep reduction in solar in the evening has been dubbed the “duck” issue by the California Independent System Operator (ISO) and has been the subject of speculation in recent years.  The duck phenomenon was evidenced this March  in California when the system average hourly prices dipped below $0 per megawatthour (MWh) in the morning hours, as described in last week’s EIA Today in Energy article.

What would a world without fossil fuels look like in the next two decades? We at OnLocation Inc. are excited to see our work featured in the recently released study “The Impacts of Restricting Fossil Fuel Energy Production.” The American Petroleum Institute (API) sponsored this study to spotlight the implications of a future in which no new fossil fuel production development occurs in the U.S.  This scenario was modeled after the so-called Keep It In The Ground (KIG) effort which has evolved from its initial start as a movement to halt oil and gas development on public lands in the U.S. into a climate movement.