Western Price Survey
February 27, 2015
Despite colder weather elsewhere in the United States, warmer weather this year to date in the West has resulted in lower natural gas demand, according to the U.S. Energy Information Administration.
This has left more natural gas storage in the region and translated into lower natural gas prices, according to the agency.
"Seven states -- California, Idaho, Nevada, Oregon, Utah, Washington, and Wyoming -- have reported average temperatures for the month of January in the top 10 warmest on record, with cumulative [heating degree days] since the beginning of the year totaling 922," EIA said in a weekly report. That is 25 percent fewer than normal and stands in stark contrast to the 2,200 cumulative heating degree days east of the Rockies for the same period.
Western spot prices have been near or below Henry Hub prices, which averaged $2.88/MMBtu between Jan. 1 and Feb. 20. Prices in the Northeast, by comparison, are four or more times higher than those in the West. The average spot price for PG&E CityGate for that period was $3.10/MMBtu, while Sumas natural gas averaged $2.54/MMBtu.
Working gas in storage reached 1,938 Bcf as of Feb. 20, according to EIA estimates, a net decrease of 219 Bcf from the previous week. Storage levels are now 42.3 percent greater than a year ago and 1.5 percent less than the five-year average.
Natural gas values rose in Thursday-to-Thursday trading, with Henry Hub gas spot values up 13 cents since Feb. 19 to trade Feb. 26 at $3.10/MMBtu. Western natural gas prices rose between a cent and 36 cents by the end of trading. El Paso-Permian natural gas gained the most, jumping 36 cents to end at $3/MMBtu. It was one of several hubs trading at or above $3 this week.
Western peak power prices moved nominally in the Feb. 20 to Feb. 27 trading period. California-Oregon Border values added 25 cents in trading, while South of Path 15 lost $1. Average daytime prices ranged from $23.60/MWh at Mid-Columbia to $33.90/MWh at SP15.
Northwest nighttime power values jumped $7 on average, with Mid-C posting the greatest gains, up $7.85 to $20.05/MWh. Average off-peak prices Friday ranged from $20.05/MWh at Mid-C to $29.75/MWh at SP15.
Peak demand on the Cal-ISO grid reached 28,596 MW Feb. 23, which should be the week's high. Northwest Power Pool demand reached the week's high of 56,902 MW that same day [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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