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Western Price Survey / Archives

May 9, 2003
Power Heads South

Prices in the spot electric market coasted lower nearly all week as the Western grid welcomed some additional supplies of power. Though fuel prices for gas-fired generators appeared to be stronger than in recent weeks, hydro resources seemed to counterbalance that potential influence on electric premiums, and peak load throughout the state remained a serene 28,000 MW.

The Palo Verde nuclear complex in Arizona powered up to capacity with the return of unit 3 from a month- long refueling. The 1,270 MW plant ran at 98 percent through Friday morning, according to the Nuclear Regulatory Commission. Palo Verde units 1 and 2 are also running at the same capacity.

"Prices jumped back a little bit when Palo Verde [unit 3] came on, especially in the Southwest," said one trader. Light-load power at Palo Verde stumbled as low as 16.75 mills and peak prices ranged from about 34 mills to 42 mills/kWh.

As Palo Verde No. 3 made its recovery, the Columbia Generating Station in Washington began preparing for its own refueling hiatus. According to Columbia owner Energy Northwest, the 1,200 MW unit will shut down for a little more than a month beginning May 10 as 292 fuel assemblies in the reactor core are replaced.

The 850 MW High Desert power plant in San Bernardino County continues to approach day-to-day operation. The plant, owned by Constellation Energy, had been on Cal- ISO's list of generators conducting planned maintenance but it shed that status temporarily on Thursday as more tests were completed. The unit is supposed to begin generating power in early summer.

Figures for unplanned generation outages on the California Independent System Operator grid followed their usual recent pattern, with approximately 2,800 MW to 3,000 MW of capacity shelved for unscheduled unit repairs. Duke Energy's Morro Bay 1 (163 MW) and Morro Bay 3 (337 MW) units are still on the blink, as well as Mirant's 682 MW Pittsburg No. 7 unit, AES's 485 MW Alamitos No. 6 plant and Reliant's 320 MW Etiwanda No. 4 plant.

PG&E Generating's La Paloma units-the 231 MW No. 1 plant and the 260 MW No. 3 unit-also stayed off the grid for unplanned fixes.

Northwestern dams turned out substantial amounts of hydropower this week, which also thinned prices. On Thursday, average production at the Grand Coulee and Chief Joseph dams totaled 3,217 MW and 1,682 MW, respectively. John Day Dam in Oregon boosted its output to 1,376 MW on Wednesday, and The Dalles produced an average of 850 MW the same day. Production at John Day slipped to 1,179 MW and The Dalles sunk to 666 MW on Thursday.

Around the West, prices for peak power crested 40 mills at some hubs but preferred a lower altitude most of the week. Premiums at the California-Oregon border and Mid-Columbia strolled the low- to mid-30 mills/kWh area, with prices at NP15 and SP15 pushing about 4 mills to 6 mills/kWh higher.

Prices for off-peak power settled into the low teens, though some trades at Mid-Columbia drew as much as 28.25 mills/kWh.

In Canada, peak prices at the Alberta hub barreled up to 480.92 mills/kWh for one hour on Monday. Light-load prices reached a high of 65.25 mills/kWh [Jason Mihos].

Gas Futures, Daily Prices Jog Higher

Other than moderate increases caused by the futures market, natural gas prices this week experienced little change in the West as spring prolongs its emergence from winter's cocoon. Temperatures throughout the region are slightly below normal for this time of year, favoring advances in daily gas trades.

The price of June contracts on the NYMEX exchange nosed higher this week, following the lead set by the crude oil market. Unexpected downtime at nuclear plants in the Southeast further aided the rise in June transaction prices.

According to this week's storage report by the federal Energy Information Administration, Western gas stocks have not taken nearly the hit absorbed by supplies in other regions. Supply in the West, which received a 12 Bcf injection during the previous week and now totals 192 Bcf, is only 4 percent lower than the five-year average for the area. Inventory in the East is off by 45 percent for the same five-year average, and storage in the gas-producing areas of the country is 47 percent lower.

Overall, nationwide gas stocks grew by 80 Bcf last week (compared to the week of April 25).

Cash prices for gas tended to bunch in the upper $4 to low $5/MMBtu range. Premiums at the Permian Basin drew the highest price at $5.33, with CityGate a close second at $5.30/MMBtu. Gas at San Juan showed the widest spread, ranging from $3.60 to $4.85, and trades at Topock played between $4.76 and $5.20/MMBtu.

At Malin, prices ticked up to $5.04/MMBtu. Prices for Alberta gas, after ending up at $4.43 last Friday, pitched up to a high of $4.88/MMBtu this week [J. M.].

Western Electricity Prices
Week of May 5-9, 2003
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 28.35-480.92 10.11-65.25
Mid-Columbia 29-35.25 19.25-28.25
COB 31-35.5 19.75-27
NP 15 32.5-39.25 19-27.75
SP 15 36.5-44.25 18-26.5
Palo Verde 34.25-42 16.75-25.5

Archives of the Western Price Survey for the past year are also available online.


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