Houston — Power utilities in the forecast path of Hurricane Michael have staged thousands of workers to help restore power for customers along the Florida Gulf Coast plus parts of southern Alabama and Georgia, where power demand is likely to fall by 20% to 30%.
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As of 1 pm CDT Tuesday, the storm was about 335 miles south of Panama City on the Florida Panhandle, packing maximum sustained winds of 110 mph, traveling north at 12 mph, the National Hurricane Center said in a public advisory.
The storm center is set to land in Northwest Florida Wednesday "and then move northeastward across the southeastern United States Wednesday night and Thursday, and move off the Mid-Atlantic coast ... by Friday," the advisory states.
Based on that path, S&P Global Platts Analytics anticipates it to affect loads in Southern Company's Alabama Power, Georgia Power and Gulf Power, plus Duke Energy Florida and Tampa Electric. If their load drops by 20%-30%, as suggested from 2017's Hurricane Irma, then load will decline by 8.7-13 average GW for about three days after the impact of the storm.
Southern Company's Gulf Power serves much of the Florida Panhandle where the hurricane is forecast to land, and the company has shifted 1,200 of its workers and 330 contractors to storm duty and has secured another 1,350 people from outside the utility to help with power restoration, if necessary.
"Customers should prepare for the possibility of losing power for an extended period when tropical storm to hurricane force winds and storm surge or flooding occurs," Gordon Paulus, Gulf Power spokesperson, said in a media release. "We have our storm plans in place and are ready for any scenario."
In power trading on the Intercontinental Exchange Tuesday, Into Georgia Transmission Corporation day-ahead on-peak was bid in the high $30s/MWh and offered in the mid-$40s/MWh, down $20 from Monday's assessment for Tuesday delivery.
If prices follow a similar pattern to hurricanes Florence this September and Irma last September, prices may be set for a rebound.
An analysis of S&P Global Platts Day-ahead Bilateral indexes for Vacar, which includes Virginia and the Carolinas, showed that average prices surged $31/MWh, or more than 80%, in the week following Hurricane Florence's arrival this September 14.
The wholesale power response to Hurricane Irma's arrival in Florida on September 10, 2017, was more muted -- with an average increase of about $3/MWh, or about 10%, from the previous week's average.
MUGGINESS TO FOLLOW
Michael Schlacter, founder and president of Weather 2000, an energy consultancy, said the storm "could strike the Florida Panhandle as a major hurricane, and then tropical mugginess and storminess will be [moved] up the East Coast."
"Besides direct tropical storm risks, when these cyclones trek/curve east of North America, they typically bolster/enhance ridging/heat," Schlacter said in an email Tuesday.
The storm looks poised to cut both regional natural gas demand and production, according to Platts Analytics. With many Southeast nuclear plants still offline for maintenance following Hurricane Florence, Hurricane Michael is less likely to slash nuclear generation and boost regional gas burn, as happened following Hurricane Florence.
Similar to Hurricane Florence, initial impacts to power burn may be largely temperature driven, but strong winds and rains could lead to increased power outages. After already falling 1 Bcf/d over the last week, Platts' current forecast for Southeast natural gas demand for generation is slated to continue to fall from a mark of 11.5 Bcf/d on Tuesday to 9.0 Bcf/d by Friday.
NUCLEAR PLANT PLANS
Southern Company has two nuclear plants in Hurricane Michael's forecast path, but neither are on the Gulf Coast. The 1,776-MW Joseph M. Farley nuclear plant at Columbia, Alabama, is about 100 miles north of Panama City Beach, Florida, and the 1,722-MW Edwin I. Hatch nuclear plant is in Baxley, Georgia, about 190 miles northeast of the Farley plant.
Platts Analytics anticipates that the Farley plant will have to close during the worst of the storm, as storm surge and heavy rains will affect its freshwater source.
However, Southern Nuclear spokeswoman Jessica Nissenbaum said her company is monitoring the storm and any potential impact on the company's fleet, and added, "At this time, we expect our units to continue to operate."
"Safety systems at nuclear power plants are designed to withstand significant hazard events," Nissenbaum said in an email Tuesday. "We are making all necessary preparations at our nuclear facilities to maintain the safe generation of clean, reliable and affordable nuclear energy."
Duke Energy Florida, which serves much of the Florida Gulf Coast, has about 1.8 million customers and has begun preparing for the storm with prestaging crews of line technicians, vegetation management workers and damage assessors, spokeswoman Peveeta Persaud said Tuesday.
Duke Energy also anticipates outages for its customers in North Carolina and South Carolina as Michael moves into the region Thursday and Friday, according to a media release emailed Tuesday afternoon.
-- Tyler Jubert, Andrew Larson and Mark Watson, firstname.lastname@example.org
-- Edited by Pankti Mehta, email@example.com