As January prepared to roll on into February, we received an update from our friends at Dukefield Energy, highlighting some notable recent/ongoing/impending movement and wider commentary relating to the current energy situation.  

Freeport LNG recently received approval from regulators to take early steps to restart its idled Texas LNG plant, which was damaged by a fire back in June of 2022. Gas has now started flowing back into the plant at very small volumes.

However, Freeport have not yet sought permission to restart the process that turns natural gas in to LNG for export, meaning the resumption of LNG production will have to come in a later request to Federal regulators.

Some analysts are now predicting that the plant will not be fully operational again until at least March, while the procedure used to cool down the pipes ready for LNG production is still ongoing.

This news may provide downward pressure to 2023 seasonal and monthly energy contracts.

Centrica unveiled plans to develop a 28MW battery energy storage facility at the former Knapton gas-fired power station in Yorkshire.

Gas-fired generation was ceased at Knapton in 2019 following the government-imposed temporary ban on fracking. Centrica also confirmed it will explore the potential for installing solar panels in the surrounding area.

A co-located battery with renewable generation like solar would help with challenges such as intermittent renewable generation by storing electricity when conditions are favour able and demand is low and then providing electricity to the grid in times of unfavourable conditions.

Should the project prove a success, it will likely incentivise further investment into battery storage and renewable generation, therefore providing long term downward pressure to UK energy markets.

SSE Renewables opened a public consultation on plans to install battery energy storage and solar generation at its existing 18-turbine 27 MW Richfield Wind Farm at Bridgetown in County Wexford, Ireland.

They are also seeking to develop a 21MW solar farm on the lands near the windfarm, in conjunction with the battery storage, which would be able to power thousands of local homes for two hours at a time.

SSE Renewables intends to submit a planning application to the County Council this spring, following a full public consultation.

Much like with Centrica's equivalent development in Yorkshire, this should provide downward pressure to Irish energy markets going forward as it would allow for more effective management of fluctuating renewable generation.

Current/recent market drivers

• Day ahead energy markets moved downwards on improving temperature and wind generation forecasts.
• Six Liquified Natural Gas (LNG) cargoes were confirmed for February, keeping gas supply fundamentals strong and contributing to downward pressure on immediate energy contracts.
• Freeport LNG have received regulatory to begin to cool down the piping system, while many analysts were predicting the plant may be operational again by March, contributing to downward pressure to summer 2023 energy contracts.
• The Heysham 2-8 615Mw nuclear reactor was set to have returned from maintenance in early February, something thought likely to contribute to downward price action in prompt markets around the same time.