Western Price Survey
December 14, 2018
As weather warmed across the Western U.S. this week, regional energy demand and prices dropped.
After climbing near or over $100/MWh in early December, daytime power prices fell between 30 and 38 percent in Dec. 6 to Dec. 13 trading. South of Path 15 values tumbled nearly $30 to end at $49.80/MWh. By Dec. 13, prices ranged from $36/MWh at Palo Verde to $54.95 at North of Path 15.
Off-peak power prices dropped between 18 and 30 percent in trading. California-Oregon Border lost $17.75, ending at $41.50/MWh. At the end of trading, prices ranged from $37.50/MWh at Palo Verde to $45.10/MWh at NP15.
California Independent System Operator demand reached 29,932 MW Dec. 10, which should be the week’s high. That same day, thermal generation of 12,910 MW fulfilled roughly 43 percent of demand.
Total renewables on the CAISO grid reached 10,201 MW Dec. 12, meeting roughly 35 percent of demand.
CAISO expects power demand to remain below 29,500 MW through Dec. 20.
The 1,200-MW Columbia Generating Station returned to full operation Dec. 13 after being powered down the evening of Dec. 6 for maintenance of pumps associated with its nuclear reactors.
Western natural gas prices remained volatile. Without weather support, prices fell between 7 cents and as much as $4.82 in Dec. 6 to Dec. 13 trading. SoCal CityGate lost the most value, dropping $4.82 to $6.19/MMBtu. A handful of hubs lost roughly $2 in trading, including Malin and Stanfield. Alberta natural gas proved to be the exception to the trend, rising 22 cents to $1.20/MMBtu.
Henry Hub natural gas spot prices lost 18 cents in trading, ending at $4.23/MMBtu.
Looking ahead, Enerfax expects natural gas futures prices will be pressured due to uncertainty over whether the colder temperatures forecast for the next couple of weeks will stick around in the new year.
U.S. natural gas production is forecast to rise to 90 Bcf per day and should put downward pressure on prices in 2019, the U.S. Energy Information Administration said in its December Short-Term Energy Outlook. Average U.S. production this year is expected to come in at 83.3 Bcfd, up 8.5 Bcfd. The EIA expects both the average production level and the daily increase will be new records.
In 2019, Henry Hub spot prices are forecast to be $3.11/MMBtu on average, 6 cents less than 2018. –Linda Dailey Paulson
Archives of the Western Price Survey for the past year are also available online.
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