Western Price Survey / Archives
March 25, 2005
Power prices in the Western region remained strong this week, reflecting the continuing upswing in the price of natural gas and concerns for Northwest hydro supplies in the coming months.
Northwest power costs remained nearly as high as California's this week, and prices throughout the West soared on Thursday. Packages were trading that day for delivery early next week. These deals, typically made on Friday, were pushed up a day on account of the Good Friday holiday. Power packages to be provided Wednesday and Thursday were dealt on Tuesday, while Friday and Saturday deliveries were traded on Wednesday.
Mid-Columbia peak power drew between 51.75 mills and 54.50 mills/KWh to open the week, added a couple more mills in value on Tuesday, and remained in the range of 52 mills to 55.50 mills/KWh until Thursday, when peak power surged up to 61 mills/KWh. Off-peak power prices at Mid-C also gained ground as the week wore on, opening Monday at a low of 46 mills/KWh and closing out Thursday at a high of 58 mills/KWh.
Nighttime power at the California-Oregon border nearly matched the Mid-C price this week, ranging from 46.75 mills to 47.25 mills/KWh on Monday before shooting up to a high of 58.25 mills/KWh for power packages to be delivered at off-peak hours Sunday and Monday. COB peak-time power values moved little during the first half of the week, remaining between 55 mills and 57 mills/KWh. By Thursday the price managed to rise only a couple of mills, closing at 59.25 mills/KWh.
A quick shutdown and return to service by Palo Verde Nuclear Generating Station Unit No. 1 over the weekend seemed to have little effect on the price of power trading at the Palo Verde hub. The 1,200 MW power generating unit was taken off line March 18 because of a failed diesel generator. By early Tuesday of this week the facility was back up to 58 percent of full output and operating at 100 percent the following day.
Palo Verde peak power changed hands for close to 56 mills/KWh on Monday and Tuesday. A slight weakening in the price showed up in Wednesday's numbers, with daytime power at the hub trading for between 52 mills and 54 mills/KWh that day. Following the trend at other locations, PV peak power ran up to 59 mills/KWh at the end of the trading week. Off-peak power at PV trailed the rest of the Western pack this week, moving for between 36 mills and 38.50 mills/KWh, before taking on what looked like a little 'roid rage and bulking up to 43.75 mills/KWh on Thursday.
Similar to last week, the price of power in Northern California nearly mirrored that in Southern California this week. Peak power south of Path 15 attracted between 57.50 mills and 58.75 mills/KWh at the start of the week before shedding a few mills in Wednesday dealing. Deliveries scheduled for early next week breathed some life back into transactions, with peak power moving for as much as 63.50 mills/KWh on Thursday. NP15 power followed the same pattern, hitting a high of 58.50 mills/KWh on Monday, then slipping down to a low of 56 mills/KWh on Wednesday, closing out the week at a high of 63 mills/KWh.
The price of off-peak power at both SP15 and NP15 stayed close to the 40 mills/KWh mark the first two days of the week. A slight cooling trend in the weather may have influenced prices at midweek, when both regions of the state recorded low-demand power costs in the vicinity of 45 mills/KWh. Still, late week trading seemed to invigorate the cost of off-peak power. By Thursday, the price shot up to 51.50 mills/KWh at SP15 and up to 49 mills/KWh in the northern part of the state [Shauna O'Donnell].
Gas Stays High
Gas prices continued to hover in the mid to high $6 range this week, driven by such moving targets as the rate of inflation and fluctuating oil costs and production targets. When one attempts to figure out the reason for the spot price of either natural gas or electricity these days, causation seems to be a loose conglomerate of guesses. With the winter heating season coming to a close, a drop in price should come sometime soon, but again, what will actually happen is anyone's guess.
The cost of Western gas opened Monday pretty much where it left off at the end of last week and showed no signs us dropping as the week wore on.
Permian Basin gas traded for as much as $6.56/MMBtu to open the week. The price rose a couple of bits on Tuesday, but eased down to between $6.47 and $6.59 at the end of the week. Meanwhile, PG&E CityGate gas ranged from $7.15 to $7.33/MMBtu this week.
In other gas news, the practices used by the global liquefied natural gas industry to prevent or respond to LNG-related emergencies are detailed in a compendium issued this week by the California Energy Commission.
The March 23 report highlights current international regulations and US laws addressing the security risk of a terrorist attack upon LNG carriers and import terminals, and also presents information from recently conducted safety and risk-assessment studies for LNG shipping and terminal construction. For example, ships are required to carry an automatic identification sys-tem, ship operators are required to appoint a company security officer, and ports are required to carry out port facility security assessments as part of regulations and protocols set by the International Maritime Organization.
"The California Energy Commission sponsored this study to inform its staff and the staffs of other state agencies about LNG safety and security practices and the safety analyses done for proposed projects," the document states. "This overview should help state agencies and others to communicate LNG safety risks and mitigation using up-to-date information."
The compendium was prepared by Aspen Environmental Group for the Liquefied Natural Gas Inter-agency Working Group, with funding provided by the California Energy Commission [S O'D and Leora Broydo Vestel].
Archives of the Western Price Survey for the past year are also available online.
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