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India Wants More Nuclear

India is bullish on nuclear energy.

The Indian government plans to build 20 new nuclear power facilities in the next decade as part of its push to increase its supply of clean energy. This would more than double the number of operating nuclear power plants in the country.

The country’s already making good on its goal. “Officials in February announced that Haryana state in northern India will be home to that region’s first nuclear plant, as a 1,400-MW facility already is under construction near Gorakhpur village, about 90 miles northwest of New Delhi. That plant will feature two 700-MW pressurized heavy-water reactors (PHWR) of Indian design,” reports Power Magazine.

India has set a goal of harnessing 500 GW of energy from non-fossil fuel sources by 2030, which would require a rapid ramp-up of nuclear and renewable energy generation capacity. To meet this goal, the country would have to greatly improve its historical construction timelines. According to the International Atomic Energy Agency, the median construction time for nuclear plants in India has been a bit longer than 14 years, from concrete pour to grid connection.

To that end, Indian government officials have signed civil nuclear cooperation agreements with a dozen countries to quicken the deployment of additional reactors.

Bankruptcy in PJM

Fallout from Winter Storm Elliott over Christmas of last year still lingers. Power plants in PJM’s territory are now filing for bankruptcy after getting slapped with fines for failing to perform during the subzero cold snap.

“Lincoln Power, which owns the 480-MW Elgin power plant and the 330-MW Rocky Road plant in Illinois, filed for bankruptcy in the U.S. Bankruptcy Court for the District of Delaware,” reports Utility Dive. “The power plants face penalties totaling $38.9 million for failing to run during the winter storm in late December, ‘a multiple’ of their annual revenue, according to a court filing.”

The chief restructuring officer for debtors told the court the power plants were already facing liquidity issues due to low clearing prices in the capacity market.

All told, power plant owners in PJM may have to cough up around $2bn for failing to provide electricity during the storm. PJM is also facing threatening capacity shortfalls as its coal fleet retires and more renewables flood its market and connection queues.

International Demand to Drive US Petroleum Production

The Energy Information Administration's Annual Energy Outlook 2023 predicts that strong international demand for petroleum and other liquids will keep US production above 2022 levels through to 2050. The agency foresees that America will remain an integral part of global oil markets.

The outlook inspects several different scenarios. Some include high and low oil and gas supply and price cases, but overall the EIA’s analysis projects modest growth in US production of petroleum and other liquids.

“In the Reference case, we project modest growth in U.S. production of petroleum and other liquids through 2050, increasing about 10% from 2022,” reports the EIA. “The other cases show a wider range of outcomes, ranging from a 48% increase in U.S. production between 2022 and 2050 in the High Oil and Gas Supply case to a 35% decrease in production in the Low Oil and Gas Supply case.”

What about high oil prices? In that case, the EIA expects high prices to rapidly increase production at first, only to fall after 2030 due to well proximity sapping output. Eventually, between 2030 and 2050, production would decrease. “By 2050, we project in the High Oil Price case that production increases by 27% compared with 2022, much less than the increase projected in the High Oil and Gas Supply case over the same time period,” reports the agency.

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Conversation Starters

1. GM beat Ford. “GM outsold Ford when it comes to electric vehicles by almost two-to-one in the first quarter of 2023 as production troubles plagued the former No. 2 EV seller behind Tesla,” reports Oilprice.com. “Ford sold 10,866 EVs in Q1 this year. While that’s up 41% from Q1 2022, it’s about 50% behind GM’s sales of 20,670 EVs. Ford’s lackluster EV performance can be attributed mostly to a factory outage in its Mexico plant that makes its Mustang Mach-E as it attempts to double the factory’s capacity, as well as five weeks of lost production with its F-150 Lightning EV due to a recall stemming from a battery fire issue.”

2. South Africa’s grid still struggles. “South Africa has revoked a national ‘state of disaster’ declared in February to manage a crippling electricity crisis,” reports Reuters. “The state of disaster gave the government additional powers to respond to the crisis, including by permitting emergency procurement procedures with fewer bureaucratic delays and less oversight. “Government will now work through its Energy Crisis Committee to reduce the impact of power cuts using existing legislation and contingency arrangements, Cooperative Governance and Traditional Affairs (CoGTA) minister Thembi Nkadimeng said in a statement.”

3. Renewable diesel has come to California. “Kinder Morgan has begun full commercial operation of both its Southern and Northern California renewable diesel hubs,” reports S&P Global. “The Southern California hub provides up to 20,000 b/d of blended diesel across two inland track racks. It has been delivering RD to San Diego since the beginning of February 2023 with deliveries to Colton, California.”

Crom’s Blessing