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Western Price Survey

January 11, 2019
Weather Triggers Aliso Canyon Withdrawals

Cool Southern California weather forced Southern California Gas Co. to withdraw 0.658 Bcf of natural gas from the Aliso Canyon natural gas storage facility between Jan. 2 and Jan. 4.

SoCal Gas on Jan. 3 issued two systemwide requests for voluntary curtailment of natural gas generation. One request covered 7 a.m. on Jan. 4 to 7 a.m. on Jan. 5; the other covered 7 a.m. on Jan. 7 to 7 a.m. on Jan. 8. The voluntary curtailment is coordinated through balancing authorities Los Angeles Department of Water & Power and the California Independent System Operator. CAISO, however, denied the request based on potential reliability issues, which triggered SoCal Gas’ need to withdraw from Aliso Canyon.

Weather also caused power outages across the Western United States beginning Jan. 5. Despite high-wind and landslide concerns, it has been “very quiet on the grid,” CAISO spokesman Steven Greenlee said Jan. 11.

Western daytime power prices dropped by between $3.65 and as much as $9 in Jan. 3 to Jan. 10 trading. South of Path 15 peak power fell $9 to $38.65/MWh in trading, and Palo Verde daytime power values tumbled 22 percent, ending at $27.75/MWh. By Jan. 10, prices ranged from $27.30/MWh at Mid-Columbia to $43.90/MWh at North of Path 15.

Off-peak power prices experienced similar movement, with SP15 losing $9.15 to end up at $33.80/MWh and Mid-C nighttime prices falling 22 percent to $24.50/MWh.

CAISO demand reached 28,544 MW on Jan. 7, which should be the week’s high.

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Total renewables on the CAISO grid reached 10,047 MW Jan. 4, fulfilling roughly 35 percent of demand. That same day, solar generation reached 8,226 MW, which met about 29 percent of demand.

Henry Hub natural gas spot prices added 26 cents in trading, ending at $2.95/MMBtu.

Western natural gas prices varied, with most hub values down between 31 cents and as much as $1.73. The Alberta and El Paso-San Juan Basin gas hubs were exceptions. El Paso-San Juan Basin natural gas added the most between the two, up 22 cents to $2.52/MMBtu. SoCal CityGate gas lost the most value in trading, tumbling $1.73 to $4.93/MMBtu.

Working natural gas in storage was 2,614 Bcf as of Jan. 4, according to U.S. Energy Information Administration estimates. This is a net decrease of 91 Bcf compared with the previous week.

The Pacific region had 204 Bcf in storage as of Jan. 4, according to EIA, following a 16-Bcf net decrease. Current storage levels are 19.4 percent less than a year ago and 26.9 percent less than the five-year average. –Linda Dailey Paulson

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

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