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Western Price Survey

Week's End Edition
February 24, 2012
Snow Forecast Lifts Northwest Power Prices

Despite lackluster domestic natural gas prices, Northwestern power prices rose in late-week trading as forecasters predicted snow and cold weather in the region lasting into Monday.

Temperatures in Seattle and Portland could fall below freezing Sunday and Monday nights, with heavy snowfall predicted in the Olympics and Cascades.

California-Oregon Border average peak power traded Friday at about $28.87/MWh, up almost $4 compared with Thursday. Mid-Columbia average peak prices gained about $3.55 over the same stretch, closing at $27.45/MWh.

Average peak prices also rose marginally at California hubs over the two-day stretch, with South of Path 15 up $2.47/MWh to $28.83/MWh and Palo Verde up $2.60/MWh, to $26.50. Over the Feb. 17 to Feb. 24 trading period, however, both hubs were down about a dollar.

Western off-peak power gained between $1.75 and about $3.25 over the trading period. Average nighttime power prices ranged between $22.45 and $25.35/MWh at the close of the trading week (see table).

Working gas in storage reached 2,595 Bcf as of Friday, Feb. 17, according to U.S. Energy Information Administration estimates, a net decrease of 166 Bcf from the previous week. Storage remains at record levels with inventories about 40 percent above last year's levels and the five-year average.

National spot natural gas prices trended lower Friday based on mild weather forecast for much of the nation, including key urban markets such as New York City and Chicago. The Henry Hub spot average price lost 7 cents since last Friday, ending at $2.60/MMBtu.

Western natural gas spot prices were down about a dime in Friday-to-Friday trading. Both PG&E CityGate and Southern California Border lost 13 cents, with prices at $2.88/MMBtu and $2.68/MMBtu, respectively, at the end of trading. Meanwhile, both Malin and Ruby-Malin posted an average price of $2.58/MMBtu Friday, down 11 cents compared with Feb. 17.

Western electricity demand remains flat. Peak use on the Cal-ISO grid reached the week's high of 29,224 MW Thursday evening. The grid operator's forecast shows the next peak in demand should occur Feb. 27, when use may reach 30,043 MW.

What's ahead: Seattle should be dry Monday with another round of precipitation starting late Tuesday, lasting into Thursday. Portland may have a mix of rain and snow Monday that could reach the valley floor. Both areas expect daytime highs in the 40s through Thursday.

The weather system expected to bring snow to the Pacific Northwest will reach the San Francisco Bay Area Monday, bringing cooler temperatures and a possibility of rain Monday. Another chance of showers is probable late Tuesday into Wednesday. Showers are also possible in the Los Angeles area Monday. Sunny weather is expected in Southern California Tuesday through Thursday, with temperatures in the 60s [Linda Dailey Paulson].

Western Electricity Prices
Week's End: February 20-24, 2012
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 18.35-358.94 12.61-301.46
Mid-Columbia 22.50-28.75 19.50-26
COB 24.50-29 20-25.50
NP 15* 26-26 21-21.75
SP 15* 26-29 19.50-23.75
Palo Verde 23.75-26.75 18.25-22.75

* 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.

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

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