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Western Price Survey

Week's End Edition
May 7, 2010
Western Energy Prices Flat; Northwest Looks Forward to Dry Summer

Energy prices throughout the West were in the doldrums this week, with both spot natural gas prices and electricity demand remaining low despite unseasonably cold weather in the Northwest.

Peak prices at Mid-Columbia changed little since the previous week. The price range was similar, with a high trade of $40/MWh on Friday compared to last Friday's price of $38.50/MWh.

California-Oregon Border daytime prices were also flat. Average prices started the week at an average $35.65/MWh and ended at $37.64. The hub posted the week's highest average price, at $39.68/MWh.

Peak prices at South of Path 15 and North of Path 15 averaged about $33 to $34/MWh most of the week.

Peak demand on the Cal-ISO grid reached a high of 29,213 MW Tuesday at 3 p.m. and was expected to fall to 28,303 MW by Friday.

The U.S. Energy Information Administration reported that natural gas prices fell across the country the week ending Wednesday, May 5. Despite continued chilly weather, last week's reports of storage that exceeded market expectations depressed prices. There is now 1.99 Tcf of gas in storage, which is 5.1 percent above a year ago and 18.8 percent above the five-year average.

The EIA also reported that natural gas production had increased 26 percent since the end of 2009, which the agency said also played a significant role in lower spot prices. Other factors cited included lower futures and falling crude-oil prices. The agency stated that spot prices at Henry Hub were down to $4/MMBtu; however, this is an increase of 9 percent or 33 cents versus the trades posted a year ago.

By Friday, Henry Hub spot was trading at an average of $3.91/MMBtu, while the futures price hit $4.01.

Again this week, renewable energy in California saw strong contributions by both wind and geothermal power sources. At peak production, renewables provided close to 3,500 MW of energy during much of the week, with the majority coming from wind and geothermal. Peak output has varied by time of day, however, occurring at midnight on Monday as high amounts of wind kicked in, but around 1 p.m. the next day. Renewables have been providing about 10.05 percent of system power, down almost 2 percent compared to last week's peak output.

The Bonneville Power Administration recorded peak wind output during the week of more than 7,600 MW Tuesday.

Late spring storms in California have had a positive effect on snowpack amounts. The California Department of Water Resources reported that its final measurement of the season showed water content was 143 percent of normal, which the agency said should bode well for hydroelectric generation.

The Northwest, however, has been coping with little snowpack. BPA said Friday it will finish the fiscal year with a projected loss of $147 million, as low snowpack conditions will affect sales of surplus power, which BPA relies on for 20 percent of revenues. "This is a bad situation that has just gotten worse," BPA Administrator Steve Wright said in a statement issued May 7. "We had hoped a wet spring would help snowpack across the Columbia River Basin, but that didn't happen. We are now looking at the fifth-lowest runoff since the hydro system has been in existence" [Linda Dailey Paulson].

Western Electricity Prices
Week's End: May 3 - 7, 2010
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 25.13-362 22.96-205.84
Mid-Columbia 31.50-40 26.50-37.75
COB 33.75-40 27.75-37
NP 15* 34.40-37.50 25.10-28
SP 15* 33.50-36 23.75-26.50
Palo Verde 33.25-36.50 23.25-27.50

* 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.

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

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