Western Price Survey / Archives
March 19, 2004
The price of power in the spot market throughout the West could not manage to gain much this week, despite the continuing heat wave throughout California. None of the region's hubs showed even a modicum of life in what one would expected to be a high-demand time.
At the NP15 trading hub, on-peak power changed hands during the first half of the week for between 42.50 mills and 44 mills/KWh, a slight drop from last week's high of 44.25 mills/KWh. By the time Friday rolled around, spreads had shrunk to less than 1 mill and the price had settled at about 41.25 mills/KWh. Power for off-peak deliveries at NP15 reached a high of 34.50 mills/KWh in Monday trading before dropping down to between 32.25 mills and 33 mills/KWh later in the week. SP15 power costs ranged a bit higher than did their northern sibling. Opening the week at between 48 mills and 49.25 mills/KWh, the price for peak power at the hub dropped down to a range of 46 mills to 47.25 mills/KWh for Friday deliveries.
On Wednesday, the real-time price for power at NP15 spiked to $138/MWh around midday. According to the California Independent System Operator, the jump was driven by the sudden loss of a generating unit. Still, the brevity of the outage--less than an hour--kept the price from staying at that level for long.
Practically no major units were on forced outage this week. A number of generation facilities that have been on planned outage continue to be off line this week, including the 900 MW Intermountain facility, Mirant Delta's 337 MW Contra Costa No. 7 unit and the 335 MW El Segundo No. 4 unit. Four Corners No. 4, with a capacity of 750 MW, has been curtailed by 355 MW for a number of weeks.
On Thursday, Pacific Gas & Electric's 163 MW Hunters Point No. 4 unit was off line and the 52 MW No. 1 unit at the facility was generating half its rated capacity. After spending much of the week on a scheduled outage, La Paloma's 235 MW No. 4 unit was also listed as being on a forced outage.
In addition to these units, the 1,122 MW San Onofre Nuclear Generating Station No. 2 remains on a refueling outage this week. All other Western nuclear units are operating at close to full power.
In the Pacific Northwest, power prices trailed California hub prices by a few mills. At Mid-Columbia, peak-power deals were being done this week for between 38.75 mills and 40 mills/KWh. Low-demand power was changing hands for between 31.25 mills and 33.25 mills/KWh this week. California-Oregon Border prices were nudged above the Mid-C mark by a few mills. Still, neither hub saw a significant spread throughout the first half of the week. COB peak power could manage only a three-quarter-mill difference between the low and high price for deals this week.
While prices for power on the daily market remained unimpressive throughout the West, scheduling coordinators and grid managers were kept busy making sure the power flowed to all the appropriate locations. Constraints between Northern and Southern California regularly forced Cal-ISO to call for incremental and decremental bids along Path 15.
On Monday, Cal-ISO issued a news release updating information about last week's 20-minute outage in Southern California Edison territory. The ISO had called on Edison to shed 300 MW of load because of an overload on Path 26. The ISO said on March 15 that operator error contributed to the outage. "It is clear that control room dispatchers did not call on the power plants fast enough to ramp up output. Demand for electricity continued to climb into the early evening, but the units could not increase their output in time to match the need for electricity," concluded Cal-ISO [Shauna O'Donnell].
Supply Leads to OFOs for CGT System
Gas prices in the West were buoyed this week by continued low temperatures in the Midwest and on the East Coast. Supply was not an issue--at least not on Pacific Gas & Electric's California Gas Transmission system--as the pipeline operator had to call system-wide operational-flow orders last Sunday and Thursday of this week due to high inventory. CGT reminded customers that in a change from previous policy, California production-balancing agreements are now subject to the same OFO rules as end-use customers and non-core aggregators.
Gas at the PG&E CityGate hub ran about 25 to 50 cents higher than deliveries at other Western hubs this week. The price stuck to a range of $5.40 to $5.49/MMBtu throughout the week. The Southern California border price exhibited a bit more elasticity. Opening the week at about $5.15/MMBtu, the price at Topock skipped up to $5.27/MMBtu in late-week trading.
San Juan gas prices, influenced by the hub's proximity to the producing basins, stayed below the $5.00 mark this week. The price of natural gas at the hub began the week at $4.85/MMBtu but managed to gain some strength toward the end of the week, closing at $0.97/MMBtu [S O'D.].
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