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Europe now has so much natural gas that prices just dipped below zero

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Re: Europe now has so much natural gas that prices just dipped below zero

#181

Earlier quoted context omitted.

Are you saying that by holding onto so much gas that there’s less in active circulation therefore it leads price increases?

He is saying having less available slack increases volatility: It led to a recent price drop because when gas usage was lower than expected there was nowhere to store the excess supply as would usually be done. It will lead to a price rise if usage is higher than expected because they won’t want to risk depleting stores too much.

To expand on this a bit, oil and particularly liquefied natural gas (LNG) production facilities are hard to stop and restart. Many systems need to be at a particular temperature, hydrates can form in gas pipelines during long shutdowns and thus need chemical back injection to manage, hot/cold cycling of equipment cause thermal degradation and many other challenges.

So a lot of design work for oil and gas production facilities is around minimising shutdowns. A large part of this is working out storage capacities, and for LNG, the shipping rates. If the LNG carriers (tankers) are unable to offload at a receiving terminal there is a higher chance the LNG loading terminal will reach tank tops. Tank tops at the loading terminal means the upstream production facility will need to turn down or stop all production. Given the high costs (capital and production opportunity) that incurs for the production facility, it might be better to take a short term loss for a few cargoes to prevent the tank tops at the loading terminal and thus a production shutdown.

Re: Europe now has so much natural gas that prices just dipped below zero

#182

This is a better situation than the reverse. It’s fortunate the winter has been mild so far. Will be interesting if the LNG industry can keep pace and replace Russia for good.

>LNG industry can keep pace and replace Russia for good. Nobody can replace Russia and their resources in the long-term.

The thermal power available from all Russian gas is about 5 years of chinese PV module production or 10 years of world wind additions at the current (rapidly increasing) rate. We can tighten the belt by 15% while building out enough capacity to replace it entirely.

Once cheap hydrolysers scale production, a huge chunk of the market will start to disappear due to ammonia production switching over.

Re: Europe now has so much natural gas that prices just dipped below zero

#183
post #170

Earlier quoted context omitted.

> only if generation efficiency is at least 33%. the efficiency of a combined cycle gas generator is usually 50-60%.

Then it depends on what portion of the electricity mix is CCG instead of simple gas turbines or coal, what’s the actual efficiency of heat pump (you won’t get 300% when it’s subzero temperature) etc. Point is, air source heat pumps are really not much, or even necessarily at all more efficient than just burning gas directly at home, it all depends.

at >50% efficiency, the heat pump heat factor has to drop below 2. On a modern heat pump that's about -25C or so. I don't think it gets that cold in Germany.

Re: Europe now has so much natural gas that prices just dipped below zero

#184
post #146

Earlier quoted context omitted.

> at times there's so much wind and nuclear power Isn't the amount of nuclear power constant?

Yes, but demand isn't. And nuclear can't be trivially shut down, the reactor stays hot for quite a while and that energy needs to go somewhere (which is the whole point of the iconic giant cooling towers these plants have). So if demand drops rapidly and your reactors are going full tilt, the price of electricity goes to zero.

More importantly: xenon poisoning.

Re: Europe now has so much natural gas that prices just dipped below zero

#186
post #5

Normally you run storage facilities neither all the way full nor all the way empty: you want to be able to smooth out fluctuations in supply and demand. Because of the war Europe is running gas storage near its upper limit, which means we should expect less flexibility and more price volatility: they won't want to draw them way down if we get a serious cold snap, and they have nowhere to put extra gas if it's warmer…

The problem is as for most of the current "Supply Chain Crisis" that the core of the problem is with logistics and distribution not raw supply, i.e. it doesn't really matter how many Liqid Gas carriers that show up of the coast of Europe as there is nowhere to unload it as the networks are designed around just in time supplies of gas flowing out of the pipelines from Russia.

This distribution problem is what is sending the price of everything sky rocketing and for anything other then microchips from the overstretched TSMC fabs the real cause of the price hikes is a breakdown in the fragile "just in time" logistics network, dependent on a few choke point running at 101% efficiency all of the time.

Re: Europe now has so much natural gas that prices just dipped below zero

#187
post #3

I had to pay 800 euros last month for home energy on my variable contract in Amsterdam. Insane.

What are the kWh prices in Amsterdam? I'm in London and would need to consume more than 1,700 kw to pay that much (£0.3866 per kWh, £0.3849 standing charge). Edit: I'm also on a variable contract

I'm not from Holland but in EU and I pay hourly market rate of my regions electricity pool.

Re: Europe now has so much natural gas that prices just dipped below zero

#188

Earlier quoted context omitted.

Same here, northern Germany, it has been unusual warm, we haven't started to heat this year yet because of it (though I might not be impacted as hard later also as the city is producing biogas and is using PtH).

Strikingly warm in Sweden as well. Geothermal heat pump does work a few hours per day, anyway. It drops far below 10 degrees celsius at night and my house is not modern enough to manage comfortable temperature with only waste energy as source.

Yes we're lucky to live in a modern house.

Re: Europe now has so much natural gas that prices just dipped below zero

#189

Earlier quoted context omitted.

> Winter starts on the 21st Dec. 21 December is Midwinter Solstice... By orbital mechanics, winter starts around 10 November.

Nope. This year, astronomical winter begins on 21 December 2022 and ends on 20 March 2023. Meteorological winter begins on 1 December. https://www.metoffice.gov.uk/weather/learn-about/weather/sea...

Irish winter starts the day after Halloween https://en.wikipedia.org/wiki/Irish_calendar

Re: Europe now has so much natural gas that prices just dipped below zero

#190

Earlier quoted context omitted.

What are the kWh prices in Amsterdam? I'm in London and would need to consume more than 1,700 kw to pay that much (£0.3866 per kWh, £0.3849 standing charge). Edit: I'm also on a variable contract

I'm not from Holland but in EU and I pay hourly market rate of my regions electricity pool.

So your prices are constantly changing? How much do you pay on average for a kW?
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