Daily Energy Standup Episode #309 – Power Politics: PG&E, Municipal Misunderstandings, and China’s Energy Game

More than two thirds of consumers report being unwilling to spend more time or money on sustainable energy actions, despite high levels of energy sustainability awareness, as affordability and access perceptions hold back clean energy […]

Highlights of the Podcast

00:00 – Intro01:12 – PG&E becomes California’s most expensive power provider03:19 – Do Municipal Politicians Actually know Where Electricity Comes From05:42 – Paradoxical Role in the Clean Energy Transition07:25 – 70% of Consumers Unwilling to Spend More on Energy Sustainability: EY Survey10:23 – Markets Update11:07 – US crude stockpiles rise, products draw down as refining slumps – EIA14:26 – Outro

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Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.

Micahel Tanner: [00:00:14] What’s going on, everybody? Welcome into the Thursday, February 15th, 2024 edition of the Daily Energy News Beat standup. Here are today’s top headlines. First up, PG&E becomes California’s most expensive power provider. Next up, do you municipality politicians actually know where their electricity comes from? I’m going to answer that right now. No, no. Next up, China’s paradoxical role in the clean energy transition. We’ll end the news segment with 70% of consumers unwilling to spend more on energy sustainability. That’s according to the latest Ernst and Young survey. I will then quickly talk about what’s happened in the oil and gas finance markets. We did see, EIA U.S. crude oil stocks rise, little product draw, which sort of led to slumping prices. And then we will let you guys get out of here and finish up your Thursday. As always, I’m joined by Stuart Turley. I am Michael Tanner. Let’s go ahead and kick us off. [00:01:12][57.5]

Stuart Turley: [00:01:12] All right man. Hey, let’s go to our favorite, club. Stupid, state here. PG and E becomes California’s most expensive power provider. Holy smokes. Batman. This one. Mark Turney, head of utility reform network. Quote unquote. Michael. This sounds like something I would even say. Okay, we have an extremely bad problem on our hands. I’m not kidding. He’s a ratepayer advocacy group. Member PGE. And customers are now paying more for power than anyone else in California. So they overspend 9.3 billion and they expect to collect every penny. [00:01:58][45.6]

Micahel Tanner: [00:02:03] Yikes. But you know who’s and you know who’s going to take it in the short, as always. [00:02:07][4.4]

Stuart Turley: [00:02:08] Right through the door. Right through. They always get you in the drive through, baby. We’re really talking in enormous numbers that are going to hurt so many families who aren’t expecting another hundred dollars a month. I think it’s going to be more than that. You can’t do a crayon. No. [00:02:23][15.0]

Micahel Tanner: [00:02:24] And and and. No, it’s just it’s fascinating to see what you know or planning. It doesn’t hurt the corporation. Their stock still going to go up. Their executives are still going to get compensated. It’s as you said, the consumer is going to hit it in the drive through. [00:02:39][15.4]

Stuart Turley: [00:02:40] Oh it is. And he’s got, two and he’s got another point down here. He goes. Are the consumers have to live within their budgets? Like everyone, like the rest of us do. One way to do that is to cap spending and make the utility count for it when it spends more than authorized, you know? Yeah. It just makes sense. It just is a bad management. Bad management is bad numbers. Yeah. Dude, what’s natural saying here? Good numbers. Good. Good management. Never mind good management. Good numbers. Do municipality politicians actually know where electricity comes from? [00:03:15][35.1]

Micahel Tanner: [00:03:17] Hey, I answered it in the open. No. [00:03:18][1.2]

Stuart Turley: [00:03:19] No. Okay, let’s go to the next article. No. I yeah. So data for yesterday’s disclosed those I industrial wind turbines delivered, almost five megawatts over 24 hours, or a measly, 4.2% of their rated capacity, even though they get first to the grid. Right? This is nuts that everybody thinks that they’re going to put in, 42MW. But it’s a that’s a nameplate. You’re only going to get 4% of that, which is, you know, the way you get to pay for that, you know? Anyway, so when you sit back and take a look at this article, I thought it was pretty fun. Based on what’s happening around the world, this is in Canada when you’re making rules, Michael, there’s nobody that reads the bills anymore. And then, your local ones are there’s now a groundswell of people wanting to stop, renewables from being in their backyard. It’s the NIMBYs. So politicians adopting the natural gas phaseout would be capable of understanding. Without those plants, Ontario would have experienced rolling blackouts that California is famous for. So people that legislators in California, in Canada, in the U.S. are making decisions based on religion rather than facts. [00:04:48][88.6]

Micahel Tanner: [00:04:49] Well, it’s a lot of what this, this, this stuff is. And what’s unfortunate is that your local women’s municipality has a lot of control over you. It’s some it’s it’s sometimes. Even more than the federal government because they’re here now. Of course it’s Canada. We have to point out. This is we’re talking about Canada, who’s gone a little overboard with some of this stuff. But I mean, again, it just goes to show you. [00:05:11][22.2]

Stuart Turley: [00:05:12] That I think it’s a wonderful thing, though. And the conclusion, Michael, I didn’t sorry. I didn’t mean to interrupt you there the the time. Well, yeah, I did. I just can, the time has come to push all elected politicians to stop the insane effort to decarbonize our economy and return to sanity unless their objective is to drive us all into energy poverty and move us back to cave dwelling days. My kind of article. [00:05:38][26.1]

Micahel Tanner: [00:05:39] Great article. We appreciate it. What’s next? [00:05:41][1.9]

Stuart Turley: [00:05:42] Let’s go to China’s paradoxical role in the clean energy transition. This is actually pretty funny when you consider China is manufacturing most of the stuff out there. The nation installed 217GW of solar, prompting the climate watchdogs that China’s greenhouse gas emissions could peak this year. I got some things I’m going to ask. They got 400 coal plants being built right now. How in the world is 217GW of installed solar going to counteract that? [00:06:21][38.9]

Micahel Tanner: [00:06:21] It’s not 1.21GW, baby. [00:06:24][2.9]

Stuart Turley: [00:06:25] Yeah. If I had my Christopher Lloyd mask on right now, it’d be great. We’re going to go back to the future and then try to find out how we can make money on this for the podcast. Michael. So China accounted for a staggering 96% of new coal power construction globally, adding a 191GW of coal coal fired power at is just unbelievable. Now those coal fired plants are building the renewable crap we’re putting in on our network. [00:06:58][33.3]

Micahel Tanner: [00:06:59] It’s now it really is. It really is crazy. I think it’s it. And it just goes to show you that just because we are focused here at home on cutting emissions, it doesn’t mean the world isn’t. And if, if, if, if we’re going to restrict ourselves here without taking into account what they’re doing across the pond, the big pond, we’re only it’s only going to hurt ourselves. [00:07:25][25.5]

Stuart Turley: [00:07:25] Here’s this next article Michael plays right into today’s, energy grid. 70% of the consumers are unwilling to spend more on energy subsidies. This survey says. And the survey says Greg Guttridge, not Greg Gutfeld. I’ve invited him to be on the podcast as well, too, but I know he’s a little busy, you know, the survey highlights, Guttridge added, 70% of the outcomes of the energy transition depend on people changing their energy consumption behaviors and lifestyles, but consumer fatigue is setting in stalling confidence in stagnating process. People are not they’re NIMBYs. They’re not going to do it in their backyard and then give up your cell phone. No. Give up. You’re traveling anywhere you want, anywhere you time. Nope. Turn your heat up. Turn your heat now? Nope. [00:08:22][56.2]

Micahel Tanner: [00:08:22] Yeah. No, I mean, I think what’s funny is there’s there’s a lot of good stuff that was woven into this article. But I think, you know, people are not willing. They want to spend less. People are used to spending less over time and things getting better over time. Think about anything else in a minute. I mean, think about your phone. Think about your car. You’ve been able to spend less over time and the efficiency or the product has improved. [00:08:50][27.8]

Stuart Turley: [00:08:51] Except for phones. People have accepted that phones were at 100 bucks, and now everybody’s getting expecting these thousand dollar phones. And Apple has done a great job increasing the price. [00:09:05][14.2]

Micahel Tanner: [00:09:06] Yeah, I mean I, I but on a but on a massive scale, the price of things have gone down over time. And I mean that’s the free market at work. Obviously we’ve got inflation right now but but no, I wouldn’t necessarily again, I’m not driving an EV so I’m not you know, I’m not and you’re not going to see me a. [00:09:23][17.1]

Stuart Turley: [00:09:23] Year after 50 is anything but. And Evie. [00:09:26][2.5]

Micahel Tanner: [00:09:28] I gotta go. Okay. Hey, I’m in Texas now. I, I’m getting my car reregistered in Texas now this year. And you don’t have to get an emissions test. That’s something in Colorado you have to do. [00:09:37][8.8]

Stuart Turley: [00:09:37] Well. [00:09:37][0.0]

Micahel Tanner: [00:09:38] But yeah, to get a vehicle inspection. So I don’t know what’s worse. [00:09:40][1.9]

Stuart Turley: [00:09:41] Well, cough twice. [00:09:42][1.0]

Micahel Tanner: [00:09:44] All right. Before we get over. [00:09:45][1.1]

Stuart Turley: [00:09:46] I was oh. [00:09:47][0.5]

Micahel Tanner: [00:09:47] Yeah, it was good or bad. Before we go and talk, finance guys will quickly pay the bills here. As always, the news and analysis you just heard is brought to you by the world’s greatest website, Energy News Beat.com. The best place for. Are all of your, energy and oil and gas news doing the team do a tremendous job making sure that websites up to speed everything you need to know. Give me the tip of the spear when it comes to the energy business. Hit the description below. You can see all the links to the articles, all the time stamps. And again, you can dive into whichever you prefer. Dashboard.energynewsbeat.com our data news combo product. Get it while you still and all right let’s. [00:10:23][35.8]

Micahel Tanner: [00:10:23] Let’s quickly talk oil prices do I mean I mean as a step back the markets have taken a little bit of hit over the last two days. I know I’ve been out. You’ve been holding it down on the solar markets today though. Did see a little bit of a rise. We’re sitting at 90 be about percent on the day just finishing above 5000. For the S&P 500, Nasdaq trading about 1.8 percentage points up to about 70,008. oh seven. We’ve seen Bitcoin up now to $51,000. Again, that’s off the back of some really bad CPI data that happened yesterday. So Bitcoin could be having another bull moment there. crude oil today actually took a little bit of a pound. We’re down to 7626 as we record this about 515 here on the 14th. And mainly that’s due to a rise in U.S., crude stocks. We saw the EIA come out and drop, their commercial. Stock tanks up 12 million barrels week over week. Sharks shocked the market just a little bit. And we saw, kind of a sell down over there. We also saw products draw down, which are refined products. And those refining utilizations, did drop week over week, which I think is, is really holding everything down. You know, that Reuters poll, you know, if you reference the article on our website, you know, Reuters was expecting a 2.6 million barrel build. So that 12 million barrel build pretty much by, you know, increases that, by about six fold. We also saw the fact that, you know, gasoline inventories, as I mentioned, they’re down to the lowest level since December of 2022. We did see, a few companies, drop earnings. We saw oxy come out today. And, or. Excuse me, they’ll be dropping them today. As you listen to this. Excuse me. We will see, cord and and tarot, but we actually did see an tarot drop there. Earnings report, which was nice. I mean, gas is, is is unfortunately getting hit, you know, kind of walking through what in tarot said today there 3.4 BCF a day, which is only a 6% increase year over year. You know, which is, which is, you know, the second line item hedging, realized a pre natural gas equivalent price of about $2.50, which is actually really good. That didn’t come up 95 million adjusted net income. Again, that’s a non-GAAP number though. 71 million adjusted Ebit tax again, non-GAAP 322 million free cash flow of about 90 million before changes in working capital. You know, they got to tout their lateral lengths, guys. That’s the other thing they, they do in their highlights. I mean, they’re only going to see about a 3% decline. What’s interesting is their guidance. I found this interesting. Their 2024 guidance, net production is expected to average 2.3 to 3.4 BCF, and natural gas production is expected to decline 3% year over year. Yet they’re spending $650 million on capital. What, you’re expecting natural gas production to decline, but we’re going to spend $650 million. I would like access to that. Budgets do. Here’s what I’m do for I’m not going to increase downloads on the podcast, but I need a campaign of about $100,000. To go do that. We’re going to experience a 3% decline in viewership. You’re going to pay me 100 grand. That’s a great pitch, right? [00:13:43][199.4]

Stuart Turley: [00:13:44] Yeah, but my visa didn’t go that high. So, you. [00:13:47][3.3]

Micahel Tanner: [00:13:47] Know, hey, thank goodness wide and tarot does. That’s what you can tap into the public market. There’s some there’s some saga I just found that hilarious. We’re expecting natural gas to decline. And we’re going to spend 650 million. What’s the I our guy on this one. Where’s the IR guy of the week. [00:14:02][15.2]

Stuart Turley: [00:14:02] Oh I R guy of the week. [00:14:04][1.7]

Micahel Tanner: [00:14:05] It’s got to be I mean it’s awesome. Let’s see if we can, let’s see if we can find, find who that is here, blah, blah, blah. I don’t think they’ve got it listed in here. Point is, you know. [00:14:15][10.4]

Stuart Turley: [00:14:16] Good. He doesn’t want his name listed. [00:14:17][1.3]

Micahel Tanner: [00:14:18] Died exactly, exactly what he wants. So it’s it’s it’s, you know. [00:14:23][5.3]

Stuart Turley: [00:14:24] Granholm. [00:14:24][0.0]

Micahel Tanner: [00:14:25] I’ll take those budgets. What else you got to do before we let people go for the week? [00:14:28][3.1]

Stuart Turley: [00:14:28] Oh, just everybody, stay tough, stay close and hug your neighbors. [00:14:32][4.2]

Micahel Tanner: [00:14:33] Yeah, hug your neighbor. No kidding. So, guys, be great with that. Guys. We’ll let you get out of here. You’ll be able to listen to it before I do what podcast we have tomorrow. [00:14:42][8.7]

Stuart Turley: [00:14:43] We’ve got about three of them. We just, released Brett Bennett today, and, we have, let me see what the production team has got going for us here. [00:14:54][10.5]

Micahel Tanner: [00:14:54] Oh, snap has been crazy. We appreciate everybody who’s reached out their work. [00:14:58][4.3]

Stuart Turley: [00:14:59] Kind of on doomberg. Yeah. Let’s see here. Doom Berg’s going to be going out. I have, Dan with Combo Curve coming out. I have JP Warren, with Keith Stelter coming out. Rhett Bennett just came out today. And then coming around the corner is Steve Reese, Andrew Dittmar within various, Kimberly Page from embarrass and Doug Sandridge and Doug, David Blackmon. We got a, full lineup. [00:15:29][30.5]

Micahel Tanner: [00:15:30] Extremely full lineup. You can check all that out on the world’s greatest podcast. The energy Newsbeat. Also available on our website, energy news b.com. We’ll have a deal. Spot a new deal spotlight out with John Farrell, CEO of World Database. We talked to Diamondback, and in Denver. So lots of good stuff. Absolutely love. [00:15:49][18.8]

Stuart Turley: [00:15:49] And they were at the booth. That’s what I. [00:15:51][1.6]

Micahel Tanner: [00:15:51] Loved. They were what love is some well, database I mean if you’re everyone should have a database account in the. You mean first of all you need a free account. But second off it’s got it’s got all of the information in a really digestible subscription, that you can take it. So we highly recommend checking out, well, database. We love them. And John, we love everybody over there. But with that, guys, we’ll let you get out of here. Have a great weekend. You can see a bunch of podcast more Saturday you’ll get the weekly recap and then we’ll see you guys back bright in early Monday morning with that guys. We’ll see you next week. [00:15:51][0.0 [898.8]