Western Price Survey
Week's End Edition
Electricity prices across the West slid this week, with losses hitting $8/MWh in places even though Western natural gas prices were practically flat.
Even though the weather varied widely between the Northwest and California, weak demand seems to be pressuring electric prices.
High pressure parked over the Pacific will keep California dry and sunny this weekend, with temperatures in the high 50s in San Francisco and the high 60s in Los Angeles. Phoenix residents will loll in mostly sunny weather and temperatures in the high 70s.
Since Monday, average California daytime prices shed nearly $6 at North of Path 15 and South of Path 15 to settle at $31/MWh. Nighttime prices remained even for the week, around $25/MWh at both hubs.
Palo Verde prime trades declined $4 to average $28.19/MWh; nighttime deliveries slid $1 to $21.72/MWh.
California power demand slowly ebbed away this week, to 28,500 MW on Thursday, down from 29,300 MW on Monday, according to the California Independent System Operator. Friday's demand is expected to pop up to 28,900 MW before slumping to 27,600 MW for the rest of the week.
Another storm will come ashore in the Northwest this weekend blowing out the sunny skies and replacing them with downpours, AccuWeather reported. Seattle and Portland temperatures will drop from the mid 50s on Friday into the high 40s this weekend. Snow is also in the picture, with six inches expected in the passes and more than a foot on the mountain ridges.
At the California-Oregon border, peak electricity prices lost $7 to settle at an average of $29.89/MWh. Off-peak trades descended $6 at $25.75/MWh.
Prime Mid-Columbia prices were off $8 to average $28.66/MWh, while off-prime trades fell $6 to $26.21/MWh.
Natural gas for April delivery perked up on Thursday, closing at $3.99/Mcf following a larger-than-expected supply withdrawal last week. The contract had fallen to a new six-year low of $3.79/Mcf on Wednesday.
Across the country, natural gas in storage plummeted to 1.681 Tcf last week, down 112 Bcf, as cold weather enrobed much of the country, prompting homeowners to dial up their thermostats. Storage is 19.2 percent higher than last year and 13.3 percent above the five-year average, according to the Energy Information Administration.
In the West, temperatures were milder and only contributed to a drop of 4Bcf, to 288 Bcf. Inventories are 59.1 percent higher than last year and 40.5 percent greater than the five-year average.
Puget Sound Energy in Washington state set a March electric peak record on Wednesday and a seven-year March natural gas use record on the back of a lingering cold spell. The utility tapped one third, or 622,000 MMBtu, of the region's largest natural gas reservoir to meet heating demand, according to the company. A new hourly electric peak for the month of March clocked in at 4,187 MW, shooting past the previous high of 3,923 MW last year.
Looking ahead: Natural gas prices continued their march south, courtesy of anemic demand and brimming stockpiles. Henry Hub spot prices have remained below $4/MMBtu since last Friday and have continued to etch new six-year lows. Prices haven't remained this low for this long since Nov. 15, 2002, the EIA said, and if prices fall below $4/Mcf this year, power generators will likely switch from coal to natural gas.
According to the EIA's Short-Term Energy Outlook published Tuesday, the country's gross domestic product is expected to fall 2.8 percent this year, leading to an overall drop in energy consumption across all fuel types. Electricity demand is projected to fall 6.4 percent among industrial users, and 1.7 percent overall. But although natural gas prices have fallen, some utilities have petitioned for rate hikes because of the higher credit costs to buy power. Homeowners should see electricity prices increase 1.1 percent this year. .
The recession also has hammered power demand. Last week, national power production dipped 3.02 percent, according to Genscape, a Louisville, Ken., real-time power supply information service, and is 1.74 percent lower than the same time last year [Kristina Shevory].
Archives of the Western Price Survey for the past year are also available online.
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