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The Bad News Report


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3 hours ago, KJHburg said:

I remember when some scoffed at Texas a few years about rolling blackouts now look what is happening here:

As extreme temps drive unusually high energy demand across the Carolinas we have begun short, temporary power outages. These emergency outages are necessary to protect the energy grid against longer, more widespread outages. We appreciate your patience.

from Duke's Twitter

To me this is unacceptable what about the peak production plants they have?  We need more power plants for this growing region.  

I scoffed at the Texas grid foibles because those issues were clearly going to hurt their economic growth. Unfortunately Duke’s situation last night will also make it harder for Duke to recruit industrial power users to come to North Carolina. Server farm recruitment is likely to take the biggest hit (not a big economic tragedy), but this will discourage any capital-intensive, three-shift, industrial facilities from setting up new facilities in NC, semiconductor production might be be our biggest (future) loss from this.

On the plus side, we do not have the variable rate structure that ERCOT has, if we did many of us would have run up $1000+ power bills from last night alone.  Electric costs in Texas last night were nearly 3000% higher than normal for consumers there. Texans dodged blackouts, but it was at a substantial cost.

I’ll be interested to hear Duke’s PR response to this and their explanations for how to they plan to prevent it in the future — perhaps they had an usual number of plants down for maintenance during a period of low industrial use? Duke’s options for wheeling more power in from outside their region were also limited due to issues with fossil fueled plants at TVA yesterday. Maybe this was a one time event? Or maybe Duke has failed to keep up with growth? We need to know.

Edited by kermit
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10 minutes ago, kermit said:

I agree, this event is going to make it much harder for Duke to recruit industrial power users to their region. Server farm recruitment is likely to take the biggest hit (not a big economic tragedy), but this will discourage any capital-intensive, three-shift, industrial facilities from setting up new facilities in NC, semiconductor production might be be our biggest loss from this.

You're spot on.  I've been waiting for this region's so-called high-growth trajectory to butt up against "constraints," and this appears to be an indelible one.  I'm sure more details will come out in the days ahead, but I find it confounding that with so much notice and with scenario analysis models, a plan to avoid taking away so many people's heat given forecasted deep cold wasn't already designed and activated.  On the other hand, it's unclear whether this region really should have more growth.  It doesn't really have the right attitude toward proactive infrastructure investing & capital planning at both the state and local level to deserve to be the high-growth state it wants to tout.  Perhaps my expectations were unrealistic, but this is not the same place I viewed it as in 2018.

Edited by RANYC
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How could Duke not not know their power usage would go up with the weather predictions???  Local tv weathermen have been screaming this for a week now.  This is extremely poor planning on Dukes part and maybe their rush to close older power plants was too much.  We need extra peak production and that is usually done through gas power plants that can be ramped up to provide more power.  

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Yes the TVA has suffered major problems and they supply power into Nashville and most of the state.  Of course to the south Georgia is cold if not colder than we are so no relief in our southeastern grid until maybe Florida.  But even Florida is chilled and there is little natural gas there thus electric usage in the central and northern parts of Florida is probably sky high too. 

But I do want answers like you all do. 

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On 12/24/2022 at 12:14 PM, KJHburg said:

from a Joe Bruno tweet 15 minutes ago

""Duke Energy tells me they are no longer rotating outages. The focus now is power restoration.""

My entire Harris Teeter shopping center near my house is out of power and has been for hours.  

Well, it’s the RTO requesting several power companies to take these measures to ensure grid reliability, other words, an authority beyond Duke…see PJM. The grid is really one interconnected entity and to work in harmony, requires a lot of coordination beyond Duke  to manage an event of this magnitude.

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Well this does not sound so good.  Uptown Charlotte zip code 28202 has lost more businesses based on US Post Office change of address requests than any other zip code in the city.  My thoughts this is many smaller offices or even though in coworking spaces that can get mail at their coworking places that went home and never came back etc.  However this is something to be concerned about in my opinion. 

From the Biz Journal this morning:

""Since the beginning of 2020 — a period largely shaped by the Covid-19 pandemic — ZIP codes in and around uptown Charlotte experienced a net decrease in the number of addresses that received business mail deliveries. That’s according to data from the U.S. Postal Service, which tracks the number of change-of-address requests from people and businesses who have recently moved.

Between the start of 2020 through October 2022, uptown’s primary ZIP code — 28202 — saw a net loss of 762 businesses, the most of any ZIP in Charlotte. That net decrease is calculated by subtracting the number of businesses that filed a change-of-address out of the 28202 ZIP code from the number that moved into the ZIP.

The net decrease stems from the 603 businesses that started having mail delivered to 28202 during that period and the 1,365 businesses there that had mail delivered to a new ZIP. The May 2020 net loss of 383 businesses from 28202 was the largest monthly net loss of any ZIP code in Charlotte between January 2020 and October 2022.

A few caveats: The data provided by the USPS includes only businesses that filed requests for a change of address. It does not indicate if that change is to a new physical location in Charlotte or elsewhere, or to a post office box. Nor does it indicate the type of business or the number of employees. The data also does not capture newly formed businesses.""

https://www.bizjournals.com/charlotte/news/2022/12/27/usps-change-of-address-uptown-south-end-businesses.html

 

 

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41 minutes ago, KJHburg said:

Well this does not sound so good.  Uptown Charlotte zip code 28202 has lost more businesses based on US Post Office change of address requests than any other zip code in the city.  My thoughts this is many smaller offices or even though in coworking spaces that can get mail at their coworking places that went home and never came back etc.  However this is something to be concerned about in my opinion. 

From the Biz Journal this morning:

""Since the beginning of 2020 — a period largely shaped by the Covid-19 pandemic — ZIP codes in and around uptown Charlotte experienced a net decrease in the number of addresses that received business mail deliveries. That’s according to data from the U.S. Postal Service, which tracks the number of change-of-address requests from people and businesses who have recently moved.

Between the start of 2020 through October 2022, uptown’s primary ZIP code — 28202 — saw a net loss of 762 businesses, the most of any ZIP in Charlotte. That net decrease is calculated by subtracting the number of businesses that filed a change-of-address out of the 28202 ZIP code from the number that moved into the ZIP.

The net decrease stems from the 603 businesses that started having mail delivered to 28202 during that period and the 1,365 businesses there that had mail delivered to a new ZIP. The May 2020 net loss of 383 businesses from 28202 was the largest monthly net loss of any ZIP code in Charlotte between January 2020 and October 2022.

A few caveats: The data provided by the USPS includes only businesses that filed requests for a change of address. It does not indicate if that change is to a new physical location in Charlotte or elsewhere, or to a post office box. Nor does it indicate the type of business or the number of employees. The data also does not capture newly formed businesses.""

https://www.bizjournals.com/charlotte/news/2022/12/27/usps-change-of-address-uptown-south-end-businesses.html

 

 

This headline is possibly making the picture appear far more grim for uptown versus other places than it actually is.  For example, a small, closely-held business may have had 5 partners receiving mail in uptown pre-covid, and to the extent 3 of the partners are now receiving mail at a different location or even at home, that quite possibly was 3 change-of-address requests but not necessarily a business relocation, per se.  So the net change in businesses might actually reflect a net count of folks heading into uptown on a regular basis.  Also, businesses that are winding down or in some form of liquidation may have mail going to a trustee or law firm or some other liquidating agent, but that's quite a different narrative than "businesses fleeing uptown."  There's natural attrition each year in uptown and in other zip codes with businesses closing or in wind-down, but again, that's not a "flee uptown" narrative.

Edited by RANYC
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Honestly I think it is a lot of people in coworking space who went home during the pandemic and may have not returned.    the article further noted that this has slowed down in the last year.  

Areas like Steele Creek and Ballantyne area showed increases in net new  business.   I think uptown's major employers are committed to uptown but many of the small offices and those in coworking may not be now.    Uptown is not at a 100% pre covid for sure but seems to be doing a lot better than the low point.   Everyone tells me Friday and sometimes Mondays are lighter uptown.   This is why we need much more residential uptown to create an even bigger neighborhood.  I would like to see a 5 to 1 ratio on residential buildings vs commercial structures. 

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1 hour ago, RANYC said:

This headline is possibly making the picture appear far more grim for uptown versus other places than it actually is.  For example, a small, closely-held business may have had 5 partners receiving mail in uptown pre-covid, and to the extent 3 of the partners are now receiving mail at a different location or even at home, that quite possibly was 3 change-of-address requests but not necessarily a business relocation, per se.  So the net change in businesses might actually reflect a net count of folks heading into uptown on a regular basis.  Also, businesses that are winding down or in some form of liquidation may have mail going to a trustee or law firm or some other liquidating agent, but that's quite a different narrative than "businesses fleeing uptown."  There's naturally attrition each year in uptown and in other zip codes with businesses closing or in wind-down, but again, that's not a "flee uptown" narrative.

I 1000% agree with you. Also. The data sets go all the way to Jan 2020 and only show businesses “leaving”.  I can’t see behind the paywall but all it says is “700 business left Uptown since 2020.” I personally view the article as relying on a narrative that will no doubt cause a stir and clicks.
 

That said. There are conversations to be had on how uptown can pivot and I think I mention that often. I think the city is behind the curve on pivoting to a post pandemic world for uptown (the crown economic jewel of the Carolinas) which I believe is sort of due to a void of leadership. From the mayors office to the banks,   there seems to be less vision and leadership on the urban core than in the past  but that has been the case for the banks for over a decade now, but we’ve had enthusiastic mayors and older stakeholders to balance that). I think there’s a level of auto-pilot & I think Charlotte government across the board has said “it’s the pandemic” and it seems like some agencies of the city points at another city and shrugs and says “see, it’s happening everywhere” when it’s cherry picked to another city that’s unique to that city and those cities are responding to it. 


Our cities can boom & be more active & be better than before and a lot are…. It’s going to be different for each city. Austin probably doesn’t need to change given it was predominately a residential boom in its core. SouthEnd in Charlotte too doesn’t need to change direction & I think is strong, better and more robust than ever. For DC, all the neighborhoods have exceeded Covid and some neighborhoods have has crazy transformations except a portion that was heavy on office but in *early-mid 2020* the city aggressively started to come up with a plan and allocate money towards turning offices to residential and DC government has websites for it, the mayor talks about it quarterly etc (and it hasn’t even slowed new construction.) it’s a big deal & DC above and beyond has the most office to residential conversions with seemingly a new announcement biweekly. See below from a Dec. 15 2022 release from DC: 

Currently, 92% of the Central Business District is made up of commercial space versus just 8% for residential. The COVID-19 pandemic led to a number of high office vacancy rates due to remote work and hybrid work trends, creating a new opportunity for the District to convert vacant and underutilized office spaces into new buildings for residential and retail use, including affordable housing units. 

“We have approached our downtown reimagination strategy from three lenses: Change the Space, Fill the Space, and Bring the People,” said Deputy Mayor John Falcicchio. “We know that creating new housing in downtown will lead to a more vibrant neighborhood and 24/7 economy. The Housing in Downtown Abatement Program will incentivize more conversions, and bring about more housing affordability and retail opportunities.” 

The Housing in Downtown Abatement Program will incentivize future residential transformations by providing tax relief for new residential projects in the Central Business District. The program requires projects to include 15% of units to be affordable at 60% of the Median Family Income. DMPED will issue regulations in early 2023 for public comment and a Request for Applications later in the year. Beginning in FY24 through FY26, $2.5 million will be available for this abatement, increasing to $6.8 million in FY27 before increasing by 4% annually.  https://dmped.dc.gov/release/mayor-bowser-celebrates-future-housing-downtown-dc


I think the Charlotte needs to throw $$$ towards affordable & low-income housing uptown & start investing in bike lanes, sidewalk widening, more pocket parks like 4th ward park, money towards Marshall Park, money towards Irwin Creek Greenway, maybe a new High School uptown, etc. It would take a couple years before things materialize, etc. But I think that’s what Charlotte needs to focus on for uptown. If we create a vibrant mixed-use uptown, I feel like the office towers and businesses will keep rolling in. I think moreso as long as uptown maintains its image of being a place people want to be.

Every city is going to need a different approach & I’d like the city of Charlotte to be a little more aggressive & proactive on uptown. It’s not grim, etc. but time is ticking on who is going to emerge from the pandemic being the leaders and the laggards. I like Charlotte being a leader. 

Edited by AirNostrumMAD
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2 hours ago, KJHburg said:

Honestly I think it is a lot of people in coworking space who went home during the pandemic and may have not returned.    the article further noted that this has slowed down in the last year.  

Areas like Steele Creek and Ballantyne area showed increases in net new  business.   I think uptown's major employers are committed to uptown but many of the small offices and those in coworking may not be now.    Uptown is not at a 100% pre covid for sure but seems to be doing a lot better than the low point.   Everyone tells me Friday and sometimes Mondays are lighter uptown.   This is why we need much more residential uptown to create an even bigger neighborhood.  I would like to see a 5 to 1 ratio on residential buildings vs commercial structures. 

But I thought all most forum participants care about is high rise count? Been complaining about this and predicting the result since we moved here in '14.

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16 hours ago, KJHburg said:

Covid as some have said exposed uptown's weakness that being it needs more residential to balance out the office space and other commercial uses. We have big landowners that have stalled uptown out Levine, Mecklenburg County and the city.  Meck County owns all that land on N Tryon several blocks including the Hal Marshall Center.  Nothing done on that land in at least 10 years. 

CCCP does do some of the stuff you mention but I see no real leadership unless it is leadership from behind.   There is no residential tax abatement plan and one is needed to jump start more growth of residential in uptown as the rest of the city is doing fine.    No high rise residential has been started uptown since the completion of 500 West Trade am I correct?  Yes some proposals and the whole thing with Brooklyn Village giving control to one developer was a big mistake in my mind.  Should have been done block by block.  

Was reminded today of the Old Duke Energy re-do into residential, and the imminent announcement of Millennium Venture's plans along College by the Convention Center, and did think to myself that perhaps Uptown is doing pretty well on construction without incentives, perhaps on a relative basis for a sunbelt city.  We should also finally see historic commission approval of plans for the bread factory re-do into residential in 4th ward.  We also have residential coming in an area still showing traces of tent city, right on Tryon Street just north of the 277 overpass.  I'd thought that area was un-developable.  The project that was to count Publix as an anchor hasn't shown  gotten off the ground, but would that change because of a tax incentive, or is that some idiosyncratic issue with the development team not getting its act together.

Edited by RANYC
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Duke is still being super vague about what happened but they say that 'multiple generators failed'. Sounds like they thought they had everything covered but poor maintenance and bad luck bit them.

https://www.wral.com/multiple-generating-units-failed-to-respond-ahead-of-duke-energy-rolling-blackouts/20646932/

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Duke is still being super vague about what happened but they say that 'multiple generators failed'. Sounds like they thought they had everything covered but poor maintenance and bad luck bit them.
https://www.wral.com/multiple-generating-units-failed-to-respond-ahead-of-duke-energy-rolling-blackouts/20646932/

I may have heard that they knew this might have happened by unexpected immense surge in power drawn from the grid. This huge draw is also by the systems in place in homes in North Carolina. The gird a complex megastructure that is aging significantly. Of course steps are being taken to restore it when damaged to be more resilient and useful for future prospects, but that will take time and a huge sum of money. I think Infrastructure capacity and age along with the general demand rise over time and the spike did the system in.

The grid is a network interconnected by wires and huge/rapid fluctuations can cause the (in some ways fragile) system to malfunction or this case to avoid a malfunction the system was “throttled” in this way. Not sure how they solved the issue or when. Some on here were comparing this to Texas, but frankly I believe it was not nearly as bad or as dramatic. Yes more outages is bad, but do not directly say length of time. In Texas people had no power for days on end….nothing compared with just the now more than few hours which is how long most should have lasted. Yet, I would agree Duke Energy has some explaining and reports to hand over to the governor I have seen. I wonder what if any will be available to the public to review. I would like to see the specific issues that lead to these rolling blackouts being so long and why they were necessary.
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