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Western Price Survey

Week's End Edition
April 23, 2010
Electricity Prices Stay Steady, While Natural Gas Prices Drop Slightly

Electricity prices stayed relatively flat across Western hubs this week as demand remained tame. Off-peak prices at Palo Verde and South of Path 15 rose about $3 and $2 respectively during the course of the week.

But average peak prices at South of Path 15 ended the week at $36.68/MWh, down just 23 cents compared with Monday's close.

At the Mid-Columbia hub average peak prices also fell, finishing around $33/MWh, down $2.11 compared with Monday and about $7 compared with last Friday.

Electricity demand peaked on Monday at 28,320 MW, according to Cal-ISO.

Cal-ISO's demand forecast showed peak demand will hover around 27,000 MW next week, with a high expected Monday at 28,527 MW.

In another sign that the economy may be improving, year-over-year natural gas demand in the electric power sector grew 14.4 percent, according to the U.S. Energy Information Administration.

That has helped push Henry Hub spot natural gas prices up 15 percent compared with this time last year.

Meanwhile, optimism that demand for crude oil would improve buoyed the market Friday, with crude-oil for June delivery closing at $85.12 a barrel, up $1.42, while natural gas for June delivery gained almost 13 cents to close at $4.34/MMBtu.

For this week, however, spot gas prices remained virtually flat at Western hubs, with Friday closing prices of $3.81 at Permian Basin and $3.77 at San Juan Basin.

Working gas in storage grew to 1,829 Bcf as of April 16, according to the EIA, representing a net increase of 73 Bcf from the previous week. This level is above the five-year historical range. Western gas storage is 28.8 percent above the five-year average and 3.8 percent above year-ago levels.

Henry Hub spot natural gas traded for an average of $3.96/MMBtu on Wednesday, 19 cents lower than the week ending Wednesday, April 14, the EIA said Thursday in its weekly natural gas update.

Henry Hub spot prices ticked up just 5 cents this week, closing Friday at $4.07/MMBtu.

A slight week-over-week increase in total natural gas demand was driven by increased demand in the residential and commercial and power-generation sectors, according to the EIA. Industrial demand, on the other hand, fell by 0.5 percent.

The agency reported that overall demand is 2.9 percent higher than it was a year ago, while total supplies are 0.2 percent lower.

The number of natural gas rigs drilling totaled 973 for the week ended April 16, an increase of 14 from the prior week, and the highest number in over a year, the EIA stated.

Temperatures are expected to reach 68 degrees by Monday in Seattle and 63 degrees in San Francisco, according to AccuWeather. Both cities could see rain on Tuesday. The outlook for Los Angeles is partly sunny, with temperatures in the low 70s on Monday.

The San Onofre Nuclear Generating Station's Unit No. 3 was operating at 53 percent capacity on Friday after an April 20 incident in which 200 gallons of sodium hydroxide was released into the plant's caustic skid berm. As of Wednesday, the release had been secured, according to a report filed with the U.S. Nuclear Regulatory Commission [Marie-Anne Hogarth].

Western Electricity Prices
Week's End: April 19 - 23, 2010
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 29.87-529.36 22.58-135.79
Mid-Columbia 29-37.50 22.50-30
COB 31.50-36.25 25.50-29.25
NP 15* 34.75-37.75 27.75-30.75
SP 15* 34-37.50 26.25-29.50
Palo Verde 29.95-36.50 24.50-31

* Prices represent both day-ahead locational marginal prices (financial swaps, or EZ Gen DA LMPs) and quasi-swap prices (EZ Gen) as reported by ICE.

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.

Please contact with questions or comments about this site.

Contact Chris Raphael, editor with questions regarding Price Survey Content.

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