Canadian government funds wind power

UK Market Stability Outlook remains febrile as the Bank of England, Treasury, and OBR forecasts shape fiscal policy, interest rates, gilt yields, inflation, energy bills, and pound sterling, with Oct. 31 guidance to reassure investors.

Key Points

A view of investor confidence as BOE policy, fiscal plans, and energy aid shape inflation and interest rates.

✅ Markets await Oct. 31 fiscal statement and OBR projections

✅ Energy support design drives inflation and disposable income

✅ Pound weakness adds imported inflation; rates seen up 75 bps

Bank of England Deputy Governor Dave Ramsden said financial markets are still unsettled about the outlook for the UK and that a Treasury statement due on Oct. 31 may provide some reassurance.

Speaking to the Treasury Committee in Parliament, Ramsden said officials in government and the central bank are dealing with huge economic shocks, notably the surge in energy prices that came with Russia’s attack on Ukraine. Investors are reassessing where interest rates and the fiscal stance are headed.

“Markets remain quite febrile,” Ramsden told members of Parliament in London on Monday. “Things have not settled down yet.”

He described the events following Prime Minister Liz Truss’s ill-fated fiscal statement on Sept. 23, which set out a series of tax cuts funded by borrowing that spooked investors and triggered a rout in UK assets. Ramsden said those events damaged the UK’s credibility among investors, but reversing that program and Truss’s decision to step aside have helped the nation regain confidence.

“Credibility is hard won and easily lost,” Ramsden said. “That credibility is being recovered. That has to be followed through. A return to the kind of stability around policy making and around the framing of fiscal events will be really important.”

He said the issue with the Sept. 23 statement was that “it had one side of the fiscal arithmetic in it” and that the decision to include forecasts from the Office for Budget Responsibility will help underpin the confidence investors have in assessing the UK budget due out next week, including potential moves to end the link between gas and electricity prices for consumers.

“What we are going to get on Oct. 31 will be very important,” Ramsden said, “as it will address measures such as the price cap on household energy bills and other fiscal choices.”

“My sense is that will take account of all the statements on both the revenue and on the spending side.”

The central bank already was getting some information from Chancellor of the Exchequer Jeremy Hunt’s team about the fiscal statement due. Hunt said last week he’d curtail government plans to subsidize household fuel bills in April, when a 16% decrease in energy bills is anticipated, instead of letting it run as long as planned and replace it with a more targeted program. 

“To the extent possible, we will obviously have a little bit of time to take account of that before we make our decisions later next week,” Ramsden said.

With Truss stepping down in the next day and handing power to Rishi Sunak, it isn’t certain the Oct. 31 statement will go ahead as planned. Ramsden’s remarks confirm reports that Hunt is preparing to make the statement, amid a free electricity debate in the industry, even before Sunak names his team.

Any hint about what sort of package Hunt will offer on energy is crucial to the BOE’s forecasts. Without aid for energy, consumers will be exposed to high winter heating and electricity costs and to the full force of whatever happens in natural gas and electricity markets, and that will have a big impact on how much disposable income is available to households.

The energy plan, alongside the energy security bill, “will be a key element, as obviously it will have a bearing on the path for inflation, which is critical, but also how much additional support relative to what we were assuming at the time of the September MPC there will be for households at different points in the income distribution,” Ramsden added.

Investors currently expect the BOE to hike rates by 75 basis points next week.

Ramsden also said the BOE is watching the pound’s decline to assess how that changes the outlook for inflation.

“We have to take account of it,” Ramsden said. “When sterling deprreciaties that feeds through to imported inflation. It’s fallen quite significantly. The overall trend is down.”

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EU Clean Energy Transition underscores the shift from fossil fuels to renewable energy, decarbonization, and hydrogen, as soaring gas prices and electricity volatility spur resilience, storage, and joint procurement across the single market.

Key Points

EU Clean Energy Transition shifts from fossil fuels to renewables, enhancing resilience and reducing price volatility.

✅ Cuts reliance on Russian gas and fossil imports

✅ Scales renewables, hydrogen, and energy storage

✅ Stabilizes electricity prices via market resilience

Soaring energy prices, described as Europe's energy nightmare, are a stark reminder of how dependent Europe is on fossil fuels and should serve to accelerate the shift towards renewable forms of energy.

"This experience today of the rising energy prices is a clear wake up call... that we should accelerate the transition to clean energy, wean ourselves off the fossil fuel dependency," a senior EU official told reporters as the European Commission unveiled a series of emergency electricity measures aimed at tackling the crisis.

The European Union is facing a sharp spike in energy prices, driven by increased global demand as the world recovers from the pandemic and lower-than-expected natural gas deliveries from Russia. Wholesale electricity prices have increased by 200% compared to the 2019 average, underscoring why rolling back electricity prices is tougher than it appears, according to the European Commission.

"Winter is coming and for many electricity costs are larger than they have been for a decade," Energy Commissioner Kadri Simson told reporters on Wednesday.

80 million European households struggle to stay warm
Wholesale gas prices — which have surged to record highs in France, Spain, Germany and Italy, amid reports of Germany's local utilities crying for help — are expected to remain high through the winter.

Prices are expected to fall in the spring, but remain higher than the average of past years, according to the Commission. Most EU countries rely on gas-fired power stations to meet electricity demand, and about 40% of that gas comes from Russia, with the EU outlining a plan to dump Russian energy to reduce this reliance, according to Eurostat.

Simson said that the Commission's initial assessment indicates that Russia's Gazprom has been fulfilling its long-term contracts "while providing little or no additional supply."
Kremlin spokesman Dmitry Peskov told journalists on Wednesday that Russia has increased gas supplies to Europe to the maximum possible level under existing contracts, but could not exceed those thresholds. "We can say that Russia is flawlessly fulfilling all contractual obligations," he said.

Measures EU states can take to help consumers and businesses cope with soaring electricity costs include emergency income support to households to help them pay their energy bills, alongside potential gas price cap strategies, state aid for companies, and targeted tax reductions. Member states can also temporarily delay bill payments and put in place processes to ensure that no one is disconnected from the grid.

Green energy the solution
The Commission also published a series of longer term measures the bloc should consider to reduce its dependence on fossil fuels and tackle energy price volatility, despite opposition from nine countries to electricity market reforms.

"Our immediate priority is to protect Europe's consumers, especially the most vulnerable," Simson said. "Second, we want to make our energy system better prepared and more resilient, so we don't have to face a similar situation in the future," she added.

Energy crisis could force more UK factories to close
This would require speeding up the green energy transition rather than slowing it down, Simson said. "We are not facing an energy price surge because of our climate policy or because renewable energy is expensive. We are facing it because the fossil fuel prices are spiking," she continued.

"The only long term remedy against demand shocks and price volatility is a transition to a green energy system."

Simson said she will propose to EU leaders a package of measures to decarbonize Europe's gas and hydrogen markets by 2050. Other measures to improve energy market stability could include increasing gas storage capacity and buying gas jointly at an EU level.

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U.S. Electricity Trade by State, 2013-2017 highlights EIA grid patterns, interstate imports and exports, cross-border flows with Canada and Mexico, net exporters and importers, and market regions like ISOs and RTOs shaping consumption and generation.

Key Points

Brief EIA overview of interstate and cross-border power flows, ranking top net importers and exporters.

✅ Pennsylvania was the largest net exporter, averaging 59 million MWh.

✅ California was the largest net importer, averaging 77 million MWh.

✅ Top cross-border: NY, CA, VT, MN, MI imports; WA, TX, CA, NY, MT exports.

According to the U.S. Energy Information Administration (EIA) State Electricity Profiles, from 2013 to 2017, Pennsylvania was the largest net exporter of electricity, while California was the largest net importer.

Pennsylvania exported an annual average of 59 million megawatt-hours (MWh), while California imported an average of 77 million MWh annually.

Based on the share of total consumption in each state, the District of Columbia, Maryland, Massachusetts, Idaho and Delaware were the five largest power-importing states between 2013 and 2017, highlighting how some clean states import 'dirty' electricity as consumption outpaces local generation. Wyoming, West Virginia, North Dakota, Montana and New Hampshire were the five largest power-exporting states. Wyoming and West Virginia were net power exporting states between 2013 and 2017.

New York, California, Vermont, Minnesota and Michigan imported the most electricity from Canada or Mexico on average from 2013 to 2017, reflecting the U.S. look to Canada for green power during that period. Similarly, Washington, Texas, California, New York, and Montana exported the most electricity to Canada or Mexico, on average, during the same period.

Electricity routinely flows among the Lower 48 states and, to a lesser extent, between the United States and Canada and Mexico. From 2013 to 2017, Pennsylvania was the largest net exporter of electricity, sending an annual average of 59 million megawatthours (MWh) outside the state. California was the largest net importer, receiving an average of 77 million MWh annually.

Based on the share of total consumption within each state, the District of Columbia, Maryland, Massachusetts, Idaho, and Delaware were the five largest power-importing states between 2013 and 2017. Wyoming, West Virginia, North Dakota, Montana, and New Hampshire were the five largest power-exporting states. States with major population centers and relatively less generating capacity within their state boundaries tend to have higher ratios of net electricity imports to total electricity consumption, as utilities devote more to electricity delivery than to power production in many markets.

Wyoming and West Virginia were net power exporting states (they exported more power to other states than they consumed) between 2013 and 2017. Customers residing in these two states are not necessarily at an economic disadvantage or advantage compared with customers in neighboring states when considering their electricity bills and fees and market dynamics. However, large amounts of power trading may affect a state’s revenue derived from power generation.

Some states also import and export electricity outside the United States to Canada or Mexico, even as Canada's electricity exports face trade tensions today. New York, California, Vermont, Minnesota, and Michigan are the five states that imported the most electricity from Canada or Mexico on average from 2013 through 2017. Similarly, Washington, Texas (where electricity production and consumption lead the nation), California, New York, and Montana are the five states that exported the most electricity to Canada or Mexico, on average, for the same period.

Many states within the continental United States fall within integrated market regions, referred to as independent system operators or regional transmission organizations. These integrated market regions allow electricity to flow freely between states or parts of states within their boundaries.

EIA’s State Electricity Profiles provide details about the supply and disposition of electricity for each state, including net trade with other states and international imports and exports, and help you understand where your electricity comes from more clearly.

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Alberta Coal Phase-Out signals a clean energy transition, replacing coal with natural gas and renewables, cutting greenhouse gas emissions, leveraging a carbon levy, and supporting workers in Alberta's evolving electricity market.

Key Points

Alberta Coal Phase-Out moves power from coal to lower-emission natural gas and renewables to reduce grid emissions.

✅ Last coal plant closed: Genesee Generating Station, Sept 30, 2023

✅ Shift to natural gas and renewables lowers emissions

✅ Carbon levy and incentives accelerated clean power build-out

The closure of the Genesee Generating Station on September 30, 2023, marked a significant milestone in Alberta's energy history, as the province moved to retire coal power by 2023 ahead of its 2030 provincial deadline. The Genesee, located near Calgary, was the province's last remaining coal-fired power plant. Its closure represents the culmination of a multi-year effort to transition Alberta's electricity sector away from coal and towards cleaner sources of energy.

For decades, coal was the backbone of Alberta's electricity grid. Coal-fired plants were reliable and relatively inexpensive to operate. However, coal also has a significant environmental impact. The burning of coal releases greenhouse gases, including carbon dioxide, a major contributor to climate change. Coal plants also produce air pollutants such as sulfur dioxide and nitrogen oxide, which can cause respiratory problems and acid rain, and in some regions electricity is projected to get dirtier as gas use expands.

In recognition of these environmental concerns, the Alberta government began to develop plans to phase out coal-fired power generation in the early 2000s. The government implemented a number of policies to encourage the shift from coal to cleaner energy such as natural gas and renewable energy. These policies included providing financial incentives for the construction of new natural gas plants and renewable energy facilities, as well as imposing a carbon levy on coal-fired generation.

The phase-out of coal was also driven by economic factors. The cost of natural gas has declined significantly in recent years, making it a more competitive fuel source for electricity generation as producers switch to gas under evolving market conditions. Additionally, the Alberta government faced increasing pressure from the federal government to reduce greenhouse gas emissions.

The transition away from coal has not been without its challenges. Coal mining and coal-fired power generation have long been important parts of Alberta's economy. The closure of coal plants has resulted in job losses in the affected communities. The government has implemented programs to help workers transition to new jobs in the clean energy sector.

Despite these challenges, the closure of the Genesee Generating Station is a positive development for Alberta's environment and climate. Coal-fired power generation is one of the largest sources of greenhouse gas emissions in Alberta, and recent wind generation outpacing coal underscores the sector's transformation. The closure of the Genesee is expected to result in a significant reduction in emissions, helping Alberta to meet its climate change targets.

The transition away from coal also presents opportunities for Alberta. The province has vast natural gas resources, which can be used to generate electricity with lower emissions than coal. Alberta is also well-positioned to develop renewable energy sources, such as wind power and solar power. These renewable energy sources can help to further reduce emissions and create new jobs in the clean energy sector.

The closure of the Genesee Generating Station is a significant milestone in Alberta's energy history. It represents the end of an era for coal-fired power generation in the province, a shift mirrored by the UK's last coal station going offline earlier this year. However, it also marks the beginning of a new era for Alberta's energy sector. By transitioning to cleaner sources of energy, Alberta can reduce its environmental impact and create a more sustainable energy future.

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Iran Bushehr Earthquake rattles southern province near the Bushehr nuclear power plant, USGS reports M5.1 at 38 km depth; seismic activity along major fault lines raises safety, damage, and monitoring concerns.

Key Points

A magnitude 5.1 quake near Bushehr nuclear plant at 38 km depth, with no damage reported, per USGS.

✅ USGS lists magnitude 5.1 at 38 km depth

✅ Near Bushehr nuclear power plant; built for stronger quakes

✅ Iran lies on major fault lines; quake risk is frequent

A magnitude 5 earthquake struck southern Iran early Friday near the Islamic Republic's only nuclear power plant. There were no immediate reports of damage or injuries as Iran continues combined-cycle conversions across its power sector.

The quake hit Iran's Bushehr province at 5:23 a.m., according to the U.S. Geological Survey. It put the magnitude at 5.1 and the depth of the earthquake at 38 kilometres (24 miles), in a province tied to efforts to transmit electricity to Europe in coming years.

Iranian state media did not immediately report on the quake. However, the Bushehr nuclear power plant was designed to withstand much stronger earthquakes, a notable consideration as Iraq plans nuclear power plants to address shortages.

A magnitude 5 earthquake can cause considerable damage, including power disruptions that have seen blackouts spark protests in some Iranian cities.

Iran sits on major fault lines and is prone to near-daily earthquakes, yet it remains a key player in regional power, with Iran-Iraq energy cooperation ongoing. In 2003, a 6.6-magnitude quake flattened the historic city of Bam, killing 26,000 people, and today Iran supplies 40% of Iraq's electricity through cross-border power deals. Bam is near the Bushehr nuclear plant, which wasn’t damaged at that time, while more recently Iran finalized deals to rehabilitate Iraq's power grid to improve resilience.

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DOE Office of Fossil Energy safeguards energy security via the Strategic Petroleum Reserve, domestic critical minerals from coal byproducts, and carbon capture to curb CO2, strengthening resiliency amid shocks and supporting U.S. manufacturing and defense.

Key Points

A DOE program advancing energy security through SPR stewardship, critical minerals R&D, and carbon capture.

✅ Manages the Strategic Petroleum Reserve for emergency crude supply

✅ Develops domestic critical minerals from coal and mining byproducts

✅ Deploys carbon capture, utilization, and storage to cut CO2

The global economy has just experienced a period of unique transformation because of COVID-19. The fact that remains constant in this new economic landscape is that our society relies on energy; it’s an integral part of our day-to-day lives, even as U.S. energy use has evolved over time. According to the U.S. Energy Information Administration, approximately 80 percent of energy consumption in the United States comes from fossil fuels, so having access to a secure and reliable supply of those energy resources is more important than ever for national energy security considerations today. Below are three examples that highlight how our work at the U.S. Department of Energy’s Office of Fossil Energy (FE) helps ensure the Nation’s energy security and resiliency.

(1) Open crude oil reserves to respond to crises

FE has overall program responsibility for carrying out the mission of the Strategic Petroleum Reserve (SPR), the world’s largest supply of emergency crude oil. These federally-owned stocks are stored in massive underground salt caverns along the coastline of the Gulf of Mexico. The SPR is a powerful tool U.S. leaders use to respond to a wide range of crises, including energy crisis impacts on electricity and fuels, involving crude oil disruption or demand loss.  When the COVID-19 pandemic hit, the oil markets crashed and crude oil demand dropped drastically across the world. U.S. oil producers turned to the SPR to store their oil while broader energy dominance constraints were becoming evident in practice. This helped alleviate the pressure on producers to shut in oil production and proved to be a critical asset for American energy and national security.

(2) Use the Nation’s abundant coal reserves to produce valuable materials

Critical materials, including rare earth elements, are a group of chemical elements and materials with unique properties that support manufacturing of most modern technologies. They are essential components for critical defense and homeland security applications, green energy technologies, hybrid and electric vehicles, and high-value electronics. While these materials are not rare, they are hard to separate and expensive to extract. The United States relies heavily on imports from China. To reduce U.S. dependence on foreign sources, FE has a research and development program aimed at producing a domestic supply of critical materials from the Nation’s abundant coal resources and associated byproducts from legacy and current mining operations. Many of the technologies being developed can also be used to separate critical minerals from other mining materials and byproducts. Tapping into these resources has the potential to create new industries and revitalize coal communities and the workforce in coal-producing regions.

(3) Decrease carbon emissions for a cleaner energy future

FE is committed to balancing the Nation’s energy use with the need to protect the environment, and has a comprehensive portfolio of technological solutions that help keep carbon dioxide (CO2) emissions out of the atmosphere. For example, amid high natural gas prices that reinforce the case for clean electricity, the Department has been investing in carbon capture, utilization, and storage technologies for over a decade. These technologies capture CO2 emissions from various sources, including coal-fired power plants and manufacturing plants, before they enter the atmosphere. Several of these cutting-edge technologies have been deployed at major demonstration sites, supported by clean energy funding that aims to benefit millions. Three of these projects—Petra Nova, Archer Daniels Midland, and Air Products & Chemicals—have captured and injected over 10.8 million metric tons of CO2. The success of these projects is paving the way toward a cleaner and more sustainable American energy future.

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