(Bloomberg) — A massive US storm stretching from the southern Rocky Mountains to New England triggered a grid emergency in the country’s midsection, prompted cascading travel disruptions and is expected to dump heavy snow on New York and Boston.
Early Saturday, the Midcontinent Independent System Operator — which runs an electric grid across parts of the Midwest and South — declared an energy-emergency alert 2 in its northern and central sections. That means it faces a “shortage and needs to reduce energy demand.” In such a situation, MISO is able to get generation that’s not usually available and can ask area utilities to encourage consumers to conserve. It’s one level beneath the highest for emergency situations.
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The combination of snow, ice and cold is leading to surging electricity demand. It also risks widespread power outages and will slow airports’ efforts to clear runways and deice planes.
Along with low temperatures, the grid operator cited forced power-plant outages and limited transfer capability across regions as the reason for the emergency.
“The extreme cold is causing power usage to increase, and we are also seeing unplanned generator outages,” Miso said in an emailed statement. “Our operators may also purchase emergency generation from neighboring grids if available.”
As much as 0.5 inch (1.27 centimeters) of ice may fall across the US South through northern Virginia, threatening roads, power lines and trees. The storm will also drop heavy snow from Oklahoma and across the Ohio Valley, before doing the same in New York and New England on Sunday.
As of 12:30 p.m. New York time, 12,481 flights into and around the US have been canceled through Monday, according to FlightAware, an airline tracking company.
About 70,000 homes and businesses didn’t have power as of 9:25 a.m. New York time on Saturday, with about 49,000 in Texas, according to PowerOutage.US.
In the Western hub of PJM Interconnection, a big US grid from Chicago to Washington, power was trading at $548 a megawatt-hour at 9:50 a.m., after spiking to more than $3,000 at 5:40 a.m.
PJM’s region has the highest concentration of data centers in the US and is the focus of concern over how electricity generation can keep pace with the AI-driven demand boom. US Energy Secretary Chris Wright urged companies to make backup power available from facilities including data centers.
The storm is estimated to cost up to $24 billion in damages and economic losses, said Chuck Watson of Enki Research. Most damage from winter systems comes from prolonged freezing temperatures, according to reinsurance firm Swiss Re. Average annual insured losses from winter weather have more than tripled to $7 billion since 2021 compared with the preceding decade, the company said.
New York
New England, which pays exorbitant prices for natural gas produced in Appalachia in the winter because of a dearth of pipeline capacity connecting the regions, was generating 35% of its electricity by burning oil, as of 11 a.m. in New York, according to the regional grid operator. That’s higher than the amount of power being generated by natural gas as dual-fuel generators often switch from gas to oil when gas prices spike.
Gas prices for near-term delivery of gas at the New England trading hub Algonquin Citygates surged as high as $44 per million British thermal units this week as utilities and other buyers bid up the price of scarce pipeline capacity.
New York is expected to see snowfall around daybreak Sunday. It may see more than of 14 inches of powder before the storm winds down Monday, said Scott Kaplan, a meteorologist with Hometown Forecast Services, which provides outlooks for Bloomberg Radio.The Boston area may see as much as 20 inches of snow, while Washington may get 8 inches or more.
That would be the heaviest snowfall in New York since January 2022 when 7.3 inches fell in Central Park and for Boston since February 2022 when 8.5 inches fell, said Allison Santorelli, a forecaster with the US Weather Prediction Center. For the US as a whole, it may be one of the most expansive in the US since a 1993 “superstorm,” said Rob Carolan, chief executive officer of Hometown Forecast Services.
New York’s Metropolitan Transportation Authority urged customers to avoid unnecessary travel Sunday and Monday, warning of disruptions to subways, bus lines and commuter rail services. Federal offices in the Washington DC area will be closed on Monday.
US Exports
Several US liquefied natural gas export plants began reducing gas supply following a reduction of activity on Friday.
Sabine Pass in Louisiana, Corpus Christi LNG and Freeport LNG in Texas, and Cove Point in Maryland all showed reduced gas supplies as of Saturday morning, according to data from BloombergNEF.
–With assistance from Lauren Rosenthal, Valentine Baldassari, Ruth Liao and Julian Hast.
(Updates flight cancelleations data.)
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