Western Price Survey
April 13, 2018
Summer-like Southern California heat triggered energy price swings throughout the week as residents attempted to cool off.
Temperatures climbed to a record-breaking 95 degrees in Long Beach April 9, while Los Angeles reached 94 degrees.
California Independent System Operator grid demand peaked at 30,177 MW April 9, which should be the week’s high. Thermal generation that same day peaked at 15,771 MW, while solar generation reached 10,263 MW.
Renewables on the CAISO grid reached 15,190 MW April 11, supplying roughly 54 percent of demand.
The warmer California temperatures supported higher natural gas prices, according to U.S. Energy Information Administration analysts, and also drove a 4 percent increase in the amount of natural gas consumed for power generation during the agency’s report week.
Working natural gas in storage was 1,335 Bcf as of April 6, according to EIA estimates. This is a net decrease of 19 Bcf compared with the previous week.
This is the fourth time since 2010 that a national net withdrawal from natural gas storage has been reported in April, according to the EIA. The natural gas storage refill season traditionally begins April 1.
Storage levels are now 35.2 percent less than a year ago and 21.9 percent less than the five-year average.
Henry Hub natural gas spot prices shed 7 cents, ending at $2.71/MMBtu in April 5 to 12 trading.
Western natural gas prices varied, with Southern California CityGate jumping $1.14 to $3.83/MMBtu, while Alberta gas dropped 87 cents to end at 70 cents/MMBtu.
Meanwhile, Western peak power values generally moved lower in trading. Mid-Columbia posted the greatest loss, down $9.85 to $14.95/MWh. Palo Verde proved the exception, adding 30 cents to $22.30/MWh.
Pacific Northwest nighttime power values dipped below the $10 mark April 9 with ample wind and hydro production. By week’s end, Mid-C lost $9.85, to end at $10.65/MWh. In contrast, North and South of Path 15 off-peak prices gained a couple of dollars in trading. Prices ranged from $10.65/MWh to $26.45/MWh by April 12.
The California snow-water equivalent decreased 4.2 inches by April 12, according to the California Department of Water Resources’ weekly bulletin. The state’s overall snowpack is now at 41 percent of the average.
In the week ahead, CAISO forecasts demand will barely surpass 27,000 MW. Active weather systems should cool the Bay Area starting April 16, with warmer conditions the following day and light rains April 18. By April 19, Southern California may expect below-normal temperatures and gusty winds.
Archives of the Western Price Survey for the past year are also available online.
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