Hurricane Helene threatens energy infrastructure on path to Florida

Hurricane Helene is forecast to hit the Big Bend coast of Florida on Sept. 26 as a “large major hurricane,” putting millions of people at risk for extended power outages and threatening energy infrastructure in its path.

Hurricane and tropical storm watches and warnings are in effect across most of Florida, and 61 counties are now under a state of emergency, according to Florida Power & Light. The utility is assembling a restoration workforce and pre-positioning crews, supplies and equipment to support restoration efforts.

“Regardless of where Helene makes landfall, customers throughout the state could see some impact from the severe weather leading to power interruptions,” FPL said in a Sept. 25 statement. “Those in the storm’s path should prepare for widespread, extended power outages.”

A major hurricane is classified as a Category 3, 4 or 5. A Category 3 hurricane has winds speeds from 111 mph to 129 mph and can make electricity unavailable for several days to weeks, while a Category 5 hurricane has wind speeds 157 mph or higher and brings power outages that could last for months.

“Helene has turned north-northwestward and is expected to turn northward and north-northeastward later today (Sept. 25) and tonight, bringing the center to the coast of the Florida Big Bend Thursday (Sept. 26) evening,” the US National Weather Service’s National Hurricane Center said in a 10am CT Set. 25 update. “After landfall, Helene is expected to interact with a deep-layer trough over the Lower Mississippi Valley and swing back to the northwest and stall near the Tennessee Valley late (Sept. 27) into the weekend.”

The last hurricane to make landfall in the US as a Category 3 – Idalia – also came ashore in Florida’s Big Bend region and generated a record-breaking storm surge from Tampa to the Big Bend in August 2023, according to hurricane center data. Idalia went through a period of rapid intensification over the warm waters of the Gulf of Mexico. Helene would be the third hurricane to make landfall in the US this year and the fourth hurricane to slam Florida since 2022.

Wholesale power prices slipped Sept. 25 despite the pending storm.

Into Southern day-ahead on-peak prices was assessed $1.50 down from Platts’ previous assessment to $37.50/MWh, with Into GTC day-ahead on-peak also moving $1.50 down to $40/MWh for Sept. 26 delivery. Despite prices moving down on the day, current prices trended up on the year, as Into SOCO trended up almost 21% from its Sept. 26, 2023, assessment of $31/MWh and Into GTC rose 21.2% from its price at the same time last year of $40/MWh.

Power utilities prepare

Storm surge, wind and rainfall impacts will likely extend well away from the center and outside the forecast cone, particularly on the east side, according to the Hurricane Center. Utilities in the storm’s path, including FPL, Tampa Electric, Alabama Power, Georgia Power, Dominion Energy and Duke Energy, as well as the federal public power company Tennessee Valley Authority, have been preparing for impact and the possible damage the storm will likely cause to oil, natural gas and electricity infrastructure.

Helene is expected to bring life-threatening storm surge, heavy rain and damaging winds to West Central Florida starting Sept. 26, which could result in significant, extended power outages, Tampa Electric said in a Sept. 25 statement. The utility, which serves more than 840,000 customers, has secured 3,500 workers from more than 20 states to help restore power after the storm passes, with most are arriving Sept. 25 in Central Florida and who will remain outside of the storm’s path until it is safe to begin working.

“The fast forward speed while Helene crosses the coast will likely result in farther inland penetration of strong winds over parts of the southeastern United States after landfall, including strong gusts over higher terrain of the southern Appalachians,” the hurricane center said.

Storm rainfall totals range from 2 inches in the western Valley to 10-12 inches across the highest elevations of the eastern Valley, TVA spokesperson Scott Brooks told S&P Global Commodity Insights.

“Due to drought conditions, the region is well below normal for rainfall and runoff and we’re not forecasting this storm to cause any problematic reservoir or mainstream river flooding,” Brooks said. “However, there is potential for flash flooding around and below some of the tributaries and unregulated streams and rivers.”

Georgia Power continues to refine plans as the storm’s path become clearer, spokesperson John Kraft told S&P Global.

“The storm system is very large and may impact communities across the state,” Kraft said. “Georgia Power is in touch with its response partners, including local and state governments, as well as other regional utilities.”

Duke Energy Florida has 8,000 workers responding to Tropical Storm Helene who are being strategically placed across the state to enable them to respond as quickly as possible to widespread power outages that are expected as a result of strong winds and heavy rainfall, spokesperson Ana Gibbs told S&P Global. The company is also sending crews from Duke Energy’s Midwest operations in Kentucky, Ohio and Indiana.

Nuclear plants at risk

Southern Company’s 1.8-GW Joseph M. Farley Nuclear Plant in southeast Alabama is inside the current projected path of the storm. Duke Energy’s 2.568-GW Oconee Nuclear Station, located in northwest South Carolina, and Southern Company’s 1.8-GW Edwin I Hatch Nuclear Plant, located in southeast Georgia, are both located just to the outside of the current projected path of the storm. All are currently operating at or near 100% capacity, according to the US Nuclear Regulatory Commission.

“As we closely monitor the development and trajectory of the approaching storm, our nuclear plants are implementing comprehensive preparation protocols to ensure continued safe operations,” Kraft said. “Our nuclear plants are designed and built to withstand extreme weather conditions, and our dedicated teams are committed to maintaining the highest standards of safety and operational integrity.”

The Oconee nuclear plant is bracing for heavy rain and high winds and has already implemented storm preparedness procedures at the side, Duke Energy spokesperson Mikayla Kreuzberger told S&P Global.

“Some preparedness actions include securing outdoor items and equipment and adjusting our work schedule to ensure our employees remain safe and that the plant continues to provide reliable electricity to customers,” Kreuzberger said. “We have robust emergency plans in place and are well-prepared to respond to conditions such as this; however, we do not anticipate having to shut down our units.”

Impacts to gas infrastructure

In the US Gulf of Mexico, producer preparations for Hurricane Helene have resulted in the shut-in of an estimated 17% of offshore natural gas production, or about 313 MMcf/d as of Sept. 25, according to the latest update from the US Bureau of Safety and Environmental Enforcement. On Sept. 25, output from US offshore gas fields was estimated at just over 1.5 Bcf/d – down about 160 MMcf/d from a recent high following earlier shut-ins prompted by Hurricane Francine. From June 1 to date, Gulf of Mexico gas production has averaged about 1.77 Bcf/d, according to Commodity Insights data.

Onshore, landfall of Hurricane Helene will likely have a modest impact gas demand, assuming no major power outages are caused by the storm. According to a seven-day forecast, power demand across the US Southeast is expected to fall about 1.4 Bcf/d through the upcoming weekend – down from an estimated 12 Bcf/d Sept. 25. Over the past 10 days, Southeast regional power burn has averaged nearly 12.3 Bcf/d, data from Commodity Insights showed.

Along the Georgia coastline, Elba Island LNG export terminal operator Kinder Morgan said it was monitoring the storm’s progress and had activated its hurricane preparedness and response plans at the facility. The terminal, located in Savannah, is by far the smallest of the seven major US LNG export terminals in operation, with a capacity of about 2.5 million metric tons per year.

A tropical storm warning was in effect for the area including Savannah, which is east of the current expected path of the storm.

“At this point, we do not expect any impacts to our operations,” Kinder Morgan spokesperson Katherine Hill said. “We will continue to evaluate the storm as it moves closer to shore and make adjustments as needed.”

Scheduled feedgas deliveries to Elba Island were about 290 MMcf/d on Sept. 25, down about 100 MMcf/d from the day prior, according to Commodity Insights data, based on nominations for the morning cycle that could later be revised. Flows to the terminal through Sept. 24 have averaged about 370 MMcf/d during the month.

Governmental preparation

President Joe Biden approved a federal emergency declaration for Florida Sept. 24 which authorizes federal funding to support response efforts and empowers the Federal Emergency Management Agency to coordinate all disaster relief operations. Local authorities in 23 counties have issued some form of evacuation order for residents living as of 3 pm CT Sept. 25, according to Florida’s Division of Emergency Management.

Georgia and North Caroline governors have declared a state of emergency.

Widespread power outages from downed trees and power lines are possible in the state Sept. 26 through the weekend and “several tornadoes will also be possible,” Georgia’s Emergency Management and Homeland Security Agency said in its latest update at 11 pm Sept. 24.

“It is possible for Helene to become a Category 4 (winds at or above 130 mph), which would produce catastrophic damage,” Alabama’s Emergency Management Agency said in its latest storm update at 7:30 am Sept. 25, adding residents should expect many trees to be downed, along with power outages.

The latest forecast shows Helene arriving in Tennessee as a tropical depression Sept. 27, with heavy rains, flooding and gusty winds possible, according to Tennessee’s Emergency Management Agency.