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Western Price Survey

Week's End Edition
Febuary 9, 2007
Wholesale Off-Peak Prices Shoot Up With Weekend Temperature Drop

While California grappled with rain, peak power prices wobbled through the week, but closed in trading on Friday about where they started on Monday. High temperatures have been mild and the price of natural gas this week in the West was not volatile.

Off-peak prices, however, made huge gains in California in Friday trading as lower temperatures were expected through Monday, along with snowstorms in the mountains and more rain.

As the weekend comes to a close, low temperatures in Los Angeles are expected to fall in the mid-40s, while in San Francisco, they are expected to drop nearly 10 degrees to about 46 degrees.

Power values in the Northwest moved to and fro throughout the week but finished on Friday virtually tied with Monday values. California-Oregon border peak power traded at about 66 mills/kWh Monday and lost a few mills as the week wore on, hitting about 60 mills/kWh on Thursday, when traders exchanged Friday and Saturday packages. On Friday, however, daytime power went for about 64 mills/kWh. Off-peak power traded around 58 mills/kWh Monday, fell down to 53 mills/kWh in Wednesday trading, and shot up to 60 mills/kWh for deliveries next Monday, though one exchange reported a Friday trade at 51 mills/kWh.

At Mid-Columbia, values for peak power started around 62 mills/kWh Monday, lost a few mills over the next few days, and bottomed out at 55.75 mills/kWh on Thursday. On Friday, the commodity reached a high price of 63.75 mills/kWh.

North of Path 15 and South of Path 15 peak power started the week trading between 64 mills and 70 mills/kWh and fell to a nadir of around 61 mills/kWh in Thursday trading. Friday values reached around 69 mills/kWh. Nighttime power at the two hubs flirted with 50 mills/kWh most of the week before drastically rising to a spread of 59 mills to 63 mills/kWh in Friday trading.

At Palo Verde, daytime power traded a bit above 62 mills/kWh to start the week, lost a few mills, and finished Friday about where it started. Low-demand power, after bottoming at 40 mills/kWh Tuesday, shot to a range of 56 mills to 62 mills/kWh for deliveries on Monday. Prices were apparently unaffected by the temporary loss of the 1,314 MW Unit No. 2 of the Palo Verde nuclear plant earlier in the week. The unit was reportedly shut down as part of weekly turbine tests, and was at 12 percent capacity Friday morning [Chris Raphael and Hugh Biggar].

Natural Gas Prices Stay Steady, But Stocks Low Compared to Last Year

Natural gas storage declined 224 Bcf for the week ending Feb. 2, the U.S. Energy Information Administration reported Thursday. Western states took out 22 Bcf, the East removed 139 Bcf, and producing states gobbled up 63 Bcf.

The decline left 2.3 Tcf of natural gas in storage. The West has 277 Bcf stored, 29 Bcf less than one year ago. Reserves in the East are down about 3 Bcf compared with storage levels last year.

The withdrawals came as the East and Midwest battled chilly temperatures and snow. Traders reportedly saw the draw as larger than expected, and gas futures shot up in trading on Thursday.

As a whole, however, U.S. natural gas storage is still 19.2 percent above its five-year historical average, and curiously, Western gas prices did not seem too much affected by the large draw, most of which occurred in the East.

Permian Basin gas prices wobbled slightly throughout the week, trading at a high of $7.90/MMBtu on Monday and dipping to a low of $6.85/MMBtu on Wednesday. In Friday trading, the median price was just a few cents above $7/MMBtu.

San Juan Basin gas also vacillated this week. Like the Permian Basin gas, San Juan's also hit a Monday high, reaching $7.43/MMBtu, then dropping to a low of $6.81/MMBtu on Wednesday. It was priced around $7/MMBtu for Saturday deliveries.

For Southern California border gas, one exchange reported the price at $10.26/MMBtu for Tuesday deliveries, but another had the range from $7.28 to $7.88/MMBtu. The commodity was priced tightly between $7.27 and $7.37/MMBtu for deliveries on Saturday [C. R. and H. B.].

Western Electricity Prices
Week's End: February 5 - 9, 2007
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 44.58-233.93 8.05-217.30
Mid-Columbia 55.75-63.75 51-59.75
COB 58.05-67 51-61.75
NP 15 61.50-71 47.50-63.25
SP 15 61.25-71.25 45.75-63
Palo Verde 56-61 40-60

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.

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

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