01:220:334 Study Guide - Midterm Guide: Ford Model T, Carbon Neutrality, California Electricity Crisis
18 Dec 2017
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Spark spread: indicator of power plant economics. Common metric for estimating probability of natural gas fired electric generators. Difference price of ng purchased and the price of electricity sold with adjustments for the heat rate. Spark spread ($/mwh) = power price ($/mwh) - [ng price ($/mmbtu) * heat rate (mmbtu/mwh)] Ng power plants heat rate bw 7~10 mmbtu/mwh. Heat rate < 7 mmbtu/mwh : extremely efficient. Heat rate > 10 mmbtu/mwh : less efficient. Limitation: does not take into consideration other costs associated with generation of electricity. Distribution hub on ng pipeline system in erath, louisiana owned by sabine pipe line. Interconnects with 9 interstate and 4 intrastate pipeplines. Generally seen to be primary price set for n. american ng market. Virtual trading location for sale, purchase, exchange of uk ng. Most liquid gas trading point in eu, major influence on price that domestic consumers pay for gas in home.
