5

5

Founded in 2011, 5 comprises a team of energy innovators, commodity traders, analysts, engineers, and former energy supplier executives. Together, they serve a broad array of private and public sector clients throughout the United States and Mexico, providing strategic advice on energy-related matters including procurement, demand-side management, rate optimization, regulatory intervention, benchmarking, bill auditing, RFP management, sustainability planning services, renewable power, and distributed generation. With an eye on growth, 5 has initiated a number of strategic partnerships and acquisitions, including the 2019 acquisition of Luthin Associates. 5 has been named to the Inc. 5000 list of fastest-growing companies in the U.S. for five consecutive years. The firm has also received numerous accolades and national awards for its corporate culture, leadership and innovation, including 5 consecutive years as a top 10 Best Company to Work for in Texas according to Texas Monthly Magazine.

Recent posts by 5

7 min read

WINTER POWER OUTLOOK: RELIABILITY & RISK ASSESSMENTS ACROSS KEY MARKETS

By 5 on January 14, 2025

Before each winter, many organizations responsible for overseeing North America's power grids release risk assessments. These reports primarily focus on reliability and resiliency, with less emphasis on wholesale prices. Although wholesale prices can indicate risk, forward prices do not always fully capture the potential risk of energy scarcity. Conversely, forward price volatility may sometimes reflect risks that are less likely than the prices suggest. This article summarizes some of these risk assessments and highlights the risks currently indicated by forward market prices for January and February 2025.

To start, the North American Electric Reliability Corporation (NERC) releases a Winter Reliability Assessment (WRA) each fall, covering key markets and regions across North America, including PJM, New York, New England, and Texas. This year’s report largely aligns with expectations, indicating that most deregulated regions face reliability risks during periods of "above-normal" load conditions. This risk summary is shown below in Figure 1.

Figure 1. Winter Reliability Risk Area Summary, by NERC

According to NERC, the primary risk facing most regions this winter is the availability of natural gas. While the power industry has made significant strides since 2021 to enhance power plant performance, much of this progress has focused on improvements in planning and forecasting. However, the most significant challenge remains the capacity of natural gas pipelines and maintaining adequate pipeline pressure levels during periods of extreme cold, which continue to pose the greatest threat to reliable power production during the winter months.

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Topics: Natural Gas PJM NYISO ERCOT Procurement
1 min read

CO-LOCATION OF DATA CENTERS AND POWER PLANTS: THE REGULATORY CROSSROADS

By 5 on January 14, 2025

Many of the largest data center owners (e.g. Google, Microsoft, and Amazon) are exploring the co-location of data center load adjacent to new or existing power plants. Energy regulators now struggle to come up with rules that fairly address the co-location of energy-intensive data centers.

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Topics: Markets Education Regulatory
5 min read

Barriers to a real Nuclear Power Renaissance

By 5 on January 14, 2025

Did you get the Simpson’s Nuclear Power Plant play set with the Homer Simpson action figure for Christmas? No? You must not have been good this year, because it seems like nuclear power is all anyone can talk about in the energy industry lately.  This is because many claim that a nuclear power “renaissance” is happening in the United States. Recently, it was reported that companies such as Amazon, Meta, Microsoft, and Google are “betting big” on nuclear power to support their growing needs for electricity for their data centers. Other appealing claims around nuclear power are that it is good for the environment because greenhouse gas emissions are negligible and unlike wind and solar assets, these plants, for the most part, run 24/7. Additionally, unlike solar and wind farms, nuclear power plants use a fraction of the land necessary to produce the same amount of electricity.  

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Topics: Markets Education Regulatory
2 min read

UNDERSTANDING PJM'S CAPACITY RULE CHANGES: IMPLICATIONS FOR AUCTION PRICES AND GRID RELIABILITY

By 5 on January 14, 2025

On December 9, PJM proposed a series of changes to its capacity rules. These changes are designed to address: (i) the high clearing prices in the 2025/2026 auction, and (ii) the increasing risk of capacity shortfalls. As discussed in earlier 5 by 5s, this capacity shortfall is driven by numerous factors including the construction of new data centers that require significant amounts of electricity, the retirement of older fossil fuel units, and delays in the development of new generation and transmission lines.

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Topics: Markets PJM Education capacity
1 min read

Webinar Recording: The Energy Transition

By 5 on November 20, 2024

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Topics: Markets Clients Videos Education Regulatory
6 min read

ELECTION IMPACTS ON ENERGY POLICY AND PRICES

By 5 on November 13, 2024

The election was a resounding win for President-Elect Trump and provides him with a clear mandate to change federal energy policy. His ability to implement policies is further supported by the fact that the Republican party now controls the Senate and may control the House of Representatives. In light of this historic shift, we have provided a short summary of the likely energy policy changes to be implemented by the Trump Administration and their impact on energy prices. While our position has been that the outcome of the election will not significantly affect near-term prices, there are factors that may influence prices in the long term.

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Topics: Markets Education Regulatory election
5 min read

BARRIERS TO A REAL NUCLEAR POWER RENAISSANCE

By 5 on October 22, 2024

 

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Topics: Natural Gas PJM NYISO ERCOT Procurement
3 min read

2024 ELECTION UPDATE

By 5 on October 22, 2024

In late August, we wrote that while the result of the Presidential election will have a significant impact on Federal energy policy, it will not materially affect energy prices. We now have a somewhat clearer understanding of Vice President Harris’ energy policy, and we continue to maintain that while several Biden climate initiatives are at risk, the election will not significantly impact near-term energy prices. In fact, as recently noted by The Economist, “Green subsidies will probably survive Mr. Trump’s re-election, and Big Oil will probably do just fine under Ms. Harris.”[1]

Below, we break down a few of these key energy policies and explain why most are not actually in play.

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Topics: Markets Education Regulatory
1 min read

Webinar Recording: PJM Capacity Auction Results and Their Impact to Your Budget Webinar

By 5 on September 26, 2024

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Topics: Markets Clients PJM Videos Education Regulatory
4 min read

SUMMER 2024 MARKET REVIEW

By 5 on August 29, 2024

As we approach the end of August, the focus of the summer typically begins to shift towards things like kids returning to school, parents seeking a more normal schedule, the excitement and optimism of each football team’s upcoming season, and hopefully milder temperatures across our power grids.

Given this, we thought it would be appropriate to give a quick update of how the summer has played out so far, by region and commodity (gas and power).

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Topics: Natural Gas PJM NYISO ERCOT Procurement