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Western Price Survey

March 31, 2006
Nuke Outages Hit the West; Power Prices React . . . Sort Of

The respite in operations at Palo Verde Unit No. 1 must have looked appealing to other nuclear facilities in the West. At one point this week, a handful of outages at plants brought output from Western nuclear facilities down to 5,442 MW out of total capacity of 9,411 MW. Wholesale power buyers are fortunate summer is not here yet, when loss of such a large amount of power would have pushed prices upward.

San Onofre Nuclear Generating Station's 1,122 MW Unit No. 2, off line since the beginning of the year for refueling, was joined by the 1,108 MW No. 3 unit on Wednesday. Both facilities remained off line at the end of the week for inspection of gaskets after operators discovered a problem in Unit No. 2. That facility is expected to return to service in about one week.

SONGS No. 3 will remain off line for approximately one month. Operators will not only inspect the gaskets during that time, but will perform planned maintenance on the unit. The maintenance was moved up from May since the plant was already off line.

Energy Northwest's Columbia Generating Station was ratcheted back to 60 percent of its 1,171 MW full output for a couple of days this week for planned maintenance. The unit was returned to full power by Friday.

Trading in the Western day-ahead power markets was fairly quiet this week. The transaction schedule was a bit skewed on account of Saturday being the first of April. Rather than the usual trading of power packages for Friday and Saturday--which would have bridged March and April--deliveries scheduled for Friday were exchanged on Wednesday, Saturday power traded on Thursday and Sunday-Monday packages moved on Friday.

Opening the week trading for between 49 mills and 51 mills/KWh, North of Path 15 peak power went nowhere during the next four days of trading. The off-peak power price topped out at 38 mills/KWh on Monday, but spent Tuesday through Thursday generally in the 34 mills to 36 mills/KWh range. Friday brought a slight boost when off-peak power hit 42.25 mills/KWh.

South of Path 15 daytime deliveries spent much of the week in the 49 mills to 52.50 mills/KWh range, but took off on Friday when the extent of the SONGS outages became clear. Peak-time power hit 61 mills/KWh that day. Off-peak power prices at SP15 mirrored those recorded at NP15 this week.

Moderate weather in the Southwest continues to keep the cost of wholesale electricity in that region fairly low. Nighttime power scheduled for delivery at Palo Verde changed hands for as little as 29.75 mills/KWh this week. Still, Friday saw the price rise as high as 42.25 mills/KWh. Daytime power at PV traded for between 45.75 mills and 47.25 mills/KWh nearly all week. The price hit 55 mills/KWh on Friday on account of the series of nuclear plant outages and typical rise in the cost for weekday power.

The cost of peak power at Mid-Columbia was rivaled this week by the settling price for off-peak power at the hub. On Monday peak power cost between 44 mills and 46 mills/KWh, while off-peak power drew between 43.75 mills and 45 mills/KWh. The return to full service by Columbia dropped the price of daytime power down to between 34 mills and 40 mills/KWh on Friday. Nighttime power moved for between 33.75 mills and 38 mills/KWh at the end of the week [Shauna O'Donnell].

Gas Responds to Large Withdrawal Figure . . . Sort Of

The price of natural gas on the Western spot market was nudged upward slightly on Thursday due to the Energy Information Administration's report of a hefty withdrawal the previous week. The gains quickly were lost on Friday, when receipt points and producing basins all lost about 20 cents relative to trading the day before.

The EIA withdrawal figure of 104 Bcf for the week ending March 24 was greater than anticipated, but after a brief stir prices relaxed as traders seemed to recall that the overall amount of gas in underground storage still remained 61 percent above the five-year average.

Southern California deliveries to the Topock hub traded for between $5.88 and $6/MMBtu on Monday. The price moved up to a high of $6.19/MMBtu toward the end of the week but then slipped back to a range of $5.85 to $6.16/MMBtu on Friday.

PG&E CityGate prices followed the same trajectory, moving up steadily after opening on Monday at a low of $6.27/MMBtu. Gas at the hub hit $6.70/MMBtu before dropping to between $6.28 and $6.40/MMBtu on Friday [S. O'D.].

Western Electricity Prices
March 27 - 31, 2006
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 9.03-89.56 8.43-59.86
Mid-Columbia 34-45.75 33.75-45
COB 42.30-48.50 35-44.25
NP 15 46-51 34.75-42.25
SP 15 48-61 33.75-42.75
Palo Verde 44-50.25 29.50-36

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 Shauna O'Donnell, editor with questions regarding Price Survey Content.

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