Western Price Survey / Archives
January 14, 2005
Clear, or at least clearer, skies prevailed over California this week, leaving utilities mopping up the damage wrought to their systems and working to restore power to the handful of customers in hard-to-reach locations still without electricity. The spate of storms over the past weekend affected 285,000 Southern California Edison customers and more than 440,000 in Pacific Gas & Electric's region--nearly all in both Southern and Northern California for a couple of hours or less.
Next Monday marks the federal holiday in honor of Martin Luther King, Jr., and trading will not be conducted that day. Therefore, the trading schedule this week included deals for deliveries as far out as next Tuesday. This shift in timing had the sag in prices that typically happens on Thursday for exchanges of weekend packages occurring on Wednesday.
North of Path 15, peak-power costs were recorded at between 58.75 mills and 62.50 mills/KWh in Monday trading. Prices lost ground as the week went on, dropping to a low of 55 mills/KWh in midweek trading before rallying and hitting 61.75 mills/KWh on Friday for next-Tuesday delivery.
SP15 peak-power costs also dropped during the first three days of the week. After opening Monday at a high of 62.50 mills/KWh, SP15 peak power dropped to between 54.75 mills and 58.50 mills/KWh in Wednesday trading. Late-week deals pushed the price back up to 60.50 mills/KWh.
Nighttime power packages both north and south of Path 15 stayed within a range of 39 mills to 42.25 mills/KWh early in the week but surged on Thursday, hitting a high of 47.50 mills/KWh for Sunday and Monday delivery.
After changing hands on Monday for between 50 mills and 54 mills/KWh, peak power at Palo Verde slipped down to a low of 47 mills/KWh on Wednesday. By the end of the week the price had tacked on another 5 mills or so, closing on Friday at 53.50 mills/KWh. The cost of off-peak power at the hub remained fairly steady this week, mostly sticking to a range of 36.50 mills to 39.75 mills/KWh.
California-Oregon Border peak-power values hovered in the vicinity of 57 mills/KWh before bucking the trend and dropping in late-week trading. On Friday COB power changed hands for between 53.75 mills and 55 mills/KWh.
Mid-Columbia power prices reflected the continuing cold snap in the Northwest. In contrast to the California prices, Mid-C prices budged very little during this week. Opening on Monday between 51 mills and 56.50 mills/KWh, peak power at Mid-C attracted between 51.75 mills and 54 mills/KWh in Friday trading. Off-peak power at Mid-C stayed within the range of 42 mills to 47 mills/KWh most of the week, skipping up to 48.50 mills/KWh on Thursday.
A handful of large natural gas-fired power generating facilities were off line during the week. Duke Energy's Moss Landing Units No. 6 and No. 7 were on unscheduled outage, taking more than 1,400 MW of capacity off the grid during the first half of the week. The 900 MW Intermountain unit in Utah, which supplies power to Southern California, was forced off line Wednesday, but was back in operation the following day. Reliant's 741 MW Ormond Unit No. 1 has been on a planned outage all week [Shauna O'Donnell].
Gas Prices Find Legs in Late-Week Dealings
The price of natural gas eased downward during the first half of this week, rallying on Thursday and Friday to post gains of between 10 cents and 20 cents for the week as a whole.
At the Permian producing basin, gas costs ran between $5.64 and $5.74/MMBtu on Monday, slipped to about $5.47/MMBtu Wednesday, but closed on Friday as high as $5.94/MMBtu for Saturday-to-Tuesday deliveries. San Juan gas also recorded a gain this week, albeit a smaller one. After hitting a low of $5.27/MMBtu on Tuesday, gas at San Juan moved for between $5.71 and $5.77/MMBtu at the end of the week.
Deliveries to the Northern California/Oregon border hub at Malin exceeded the $6.00/MMBtu mark on Friday after dipping down to $5.50/MMBtu in midweek trading. The Southern California hub at Topock also saw its share of $6-plus gas at the end of the week, closing at $6.06/MMBtu. This represented a gain of about a dime over Monday's price and nearly 50 cents over the low of $5.58/MMBtu recorded on Wednesday.
The Energy Information Administration is seeking comments on proposed revisions to its Weekly Natural Gas Storage Report. The impetus for the possible changes was the pre-Thanksgiving reporting error that drove month-ahead prices up by as much as $1.00/MMBtu. EIA's current policy of revising its posted storage figures only on Thursdays--when it posts its weekly changes--meant that the error recorded November 24 was not corrected until December 2. Market participants were critical of EIA's delay in rectifying the situation.
According to a notice in the Federal Register published January 7, EIA is proposing to change its revision policy in one of two ways. The first option would have the storage data revised, if warranted, on the Monday following the EIA's weekly Thursday release of the underground storage figures. In the second option, EIA would release the revised numbers as soon as it learns of the error, but no sooner than two hours after it sends out a notice to market participants that a revision is forthcoming.
The administration requested that comments on its proposal be submitted by February 7 [S. O'D.].
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