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Western Price Survey / Archives

January 25, 2002
Power Market Hangs Loose

There was very little movement in power prices this week and despite colder weather, loads remained in line with forecasts and slowly crept up to the 32,300 MW mark midweek at the California Independent System Operator.

Peak prices hung in the low 20s in California and the Southwest but edged lower in the Pacific Northwest. The Bonneville Power Administration offered 200 MW both day and night all week long at market prices.

The Martin Luther King. Jr. Day observance on Monday carried last week's low price mentality into this week and even after traders got back to work, there was little to do. "It's very quiet," was the refrain heard from British Columbia to New Mexico and all points in between.

The Cal-ISO outage list varied between 12,600 MW and 13,589 MW with between 9,400 MW and 10,400 MW labeled as planned maintenance. However, in testimony to a California Assembly committee this week Cal-ISO's operations vice president Jim Detmers revealed that as much as 3,500 MW of that is "economic shutdowns" in which both the grid operator and the generator agreed to let the unit go off line because it would not be economic to continue running under current market conditions. Cal-ISO agrees to such outages, he said, because keeping the plants on line might cause system problems, especially during low load periods. There is still a must-offer requirement in effect, but currently there is little need. The units are supposed to get up to speed quickly if needed, however.

Mid-Columbia peaked in a tight range of 18.75 mills to 19 mills/KWh with off-peak centering at 16.5 mills/KWh; the California/Oregon Border varied around the 20 mills point for peak and 16.5 mills to 17 mills/KWh for off-peak; NP15 and SP15 were between 21 mills and 24.5 mills but mainly at 22.5 mills/KWh with the overnight running between 16.5 mills and 17.5 mills/KWh. California water project managers bought at 18 mills and sold at 19 mills/KWh on average.

The Southwestern prices all kind of smooshed together in the 20.5 mills to 23.5 mills range for peak and 14 mills to 18 mills/KWh for off-peak energy. Indications were the Palo Verde hub was at the low end of those ranges, except for a few late trades, while Nevada held the higher end [Arthur O'Donnell].

Canadian Gas Shut In

With a three-day maintenance outage closing off the eastbound route for natural gas supplies flowing out of Alberta, Canadian gas prices loosened the grip they had on the $(C)3.00/Gigajoule mark this week. As much as 1 billion cubic feet per day of gas had no place to go, so it did not even make it into the pipelines heading south.

Traders said pipeline operators were pulling gas out of storage to balance the pipes, but with slack demand from power generators, there was no real price impetus. The national storage withdrawal figure was 124 BCf for the week, less than anticipated. Though Thursday saw an attempted rally at Henry Hub, it was not convincing given the drop in February prices.

As a result, every time Western prices tried to move off the mark, they reverted back to the starting point in short order. The Southwestern basins varied little from $2/MMBtu and both Topock and the PG&E CityGate stayed in the $2.15 to $2.20/MMBtu range.

Malin was thin, also centering at $2.15/MMBtu. The lack of spreads between trading points was a signal that there was little or no reason to move gas around the system [A. O'D.].

Western Electricity Prices
Week of January 21-25, 2002
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 26-61 9-44
Mid-Columbia 21-24.5 17.5-21.5
COB 18.5-19 16-16.75
NP 15 21-24 17-17.5
SP 15 22.5-24.5 16.75-17
Palo Verde 20.5-23.5 14-15.25

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


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