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Western Price Survey

Week's End Edition
January 4, 2013
Western Natural Gas Prices Drop

Ample stores continue dragging natural gas prices lower. Domestic storage levels remain 0.7 percent greater than a year ago and 12.4 percent above the five-year average, despite a net withdrawal the week of Dec. 24-28.

Working gas in storage reached 3,517 Bcf as of Friday, Dec. 28, according to U.S. Energy Information Administration estimates, a net decrease of 135 Bcf from the previous week.

Henry Hub natural gas prices dropped 20 cents compared with Dec. 28 to almost $3.20/MMBtu. Western prices also fell, with PG&E CityGate down 17 cents, ending at $3.56, and SoCal Border gas dipping 15 cents to almost $3.37/MMBtu.

"The presence of such a huge stash of natural gas in storage will weigh on prices until it is worked off due to cold weather," Enerfax noted in a Jan. 2 report. "However, traders say there are strong factors that may set a floor on gas prices of around $3.30 [per MMBtu]. Until this winter shows a supply deficit compared with last year's, the market will likely remain entrenched in a choppy-sideways mode."

Meanwhile, average peak-power prices in the West have been static since last Friday. Here's how Western hubs fared in the Dec. 28 to Jan. 4 trading period:

  • Mid-Columbia: Lost about 45 cents to about $25.85/MWh.
  • California-Oregon Border: Down roughly 20 cents to almost $28.15/MWh.
  • North of Path 15: Last traded Jan. 4 at $38.50/MWh.
  • Palo Verde: Shed 75 cents to about $30.55/MWh.
  • South of Path 15: Last traded Jan. 4 at about $48.20/MWh.

Average prices for off-peak electricity in the West on Jan. 4 were mixed, ranging from $25.90/MWh at Palo Verde to $39.47/MWh at SP15. SP15 led gainers, jumping about $8.50 since Dec. 28. The region is still coping with the loss of San Onofre Nuclear Generating Station units No. 2 and No. 3, which have been off line for almost a year.

Peak demand on the Cal-ISO grid reached 30,683 MW Thursday, Jan. 3. Northwest Power Pool recorded demand of 61,657 MW Wednesday.

Cal-ISO recorded a new solar-generation peak of 1,122 MW Dec. 31, 2012. Steven Greenlee, a Cal-ISO spokesman, said the figure is an instantaneous peak rather than an hourly average. The previous peak was reached on Aug. 31, when solar contributed 1,076 MW of generation.

"This is not typical for this time of year for an all-time peak," noted Greenlee, "but because of new installations coming on line and a clear-sky day throughout the state [this] provided us good solar conditions and a new peak was set."

What's ahead: The Pacific Northwest could see rain on Monday, Jan. 7, but the probability of precipitation decreases as the week progresses. Daytime highs in the 40s are forecast for Seattle and Portland through Thursday. The San Francisco area should be partly to mostly sunny with temperatures in the 50s starting Monday. After possible showers Monday, both Southern California and Phoenix expect mostly sunny skies and highs in the 60s through Thursday.

The National Weather Service has forecast below-normal temperatures from Washington into Southern California and Arizona from Jan. 9 through Jan. 17 [Linda Dailey Paulson].

Western Electricity Prices
Week's End: Dec. 31, 2012 - Jan. 4, 2013
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 10.31-46.27 10.43-32.89
Mid-Columbia 25.25-31 23.50-27.75
COB 28-33 25.75-28.50
NP 15* 38.25-41.25 32-35
SP 15* 41-49.50 34-40.25
Palo Verde 29.25-35 23-30

* Prices represent both day-ahead locational marginal prices (financial swaps, or EZ Gen DA LMPs) and quasi-swap prices (EZ Gen) as reported by ICE.

Archives of the Western Price Survey for the past year are also available online.

The Western Price Survey is excerpted from Energy NewsData's comprehensive regional news services. See for yourself how NewsData reporters put events in an accurate and meaningful context -- request a sample of either or both California Energy Markets and Clearing Up.

Please contact with questions or comments about this site.

Contact Chris Raphael, editor with questions regarding Price Survey Content.

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