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Western Price Survey / Archives

May 16, 2003
Prices Warm to Increased Demand

Spot power prices this week climbed higher as sunny weather and rising electric demand made their way around the West. Temperatures above 80 degrees visited numerous areas throughout the state and in the Southwest, stirring long-idle air conditioners and pumping life into bilateral premiums. Prices for natural gas prices ran up as well, giving further support.

Though dams in the region continue to churn out hydro supplies, changing river conditions are affecting the amount of power available, according to traders. "The rivers are being run more economically, and there's not as much hydro out there," said one market player, noting that increased flows due to flood concerns have since abated.

Grand Coulee Dam produced an average of 3,310 MW on Tuesday, surpassing its April production average by nearly 1,000 MW. Chief Joseph tallied 1,808 MW the same day, its highest average output in at least six weeks. On Thursday, the dams produced on average 3,141 MW and 1,675 MW, respectively.

Farther south on the Columbia, The Dalles generated 887 MW on Wednesday, just above its April average of 870 MW. John Day Dam, which put out an average of 1,239 MW in April, produced 1,422 MW. The dams yielded 746MW and 1,146 MW, respectively, in average production on Thursday.

The California Independent System Operator reported peak demand at about 29,000 MW throughout the week. Bunches of generation remained off line for scheduled spring maintenance, roughly totaling between 16,500 MW and 17,500 MW in curtailed capacity. Unexpected outages amounted to approximately 2,100 MW to about 2,900 MW over the course of the week.

The 485 MW Alamitos No. 6 unit, owned by AES Corporation, remained off line for unplanned repairs, as well as Reliant's 320 MW Etiwanda No. 4 plant. Etiwanda No. 3, also 320 MW, is shut down for scheduled work, as are Alamitos plants 1, 2, 4 and 5.

AES's four Redondo Beach units are undergoing planned maintenance, as are Mirant's five Pittsburg plants and two Contra Costa plants. PG&E Generating's La Paloma 1 and 3 units, rated at 231 MW and 260 MW, respectively, remained off line most of the week for unexpected fixes, with unit 1 back in action for Thursday.

Cal-ISO spokesperson Stephanie McCorkle said the grid suffered no impact from a power-line accident in San Diego early Wednesday morning. A construction crane collapsed, dragging down two 66 KV power lines and one 138 KV line and causing "the worst traffic jam in the history of San Diego," according to San Diego Gas & Electric spokesperson David Johnson. The utility restored power to all 2,900 customers affected by the outage by Thursday morning.

Peak prices in the West drifted higher as the middle of the week approached, with most hubs experiencing about a 10 mills/KWh spread between Monday and Wednesday. Trades at Mid-Columbia and the California- Oregon border moved nearly in tandem, each reaching to at least 40 mills/KWh midweek. At NP15, heavy-load prices rose to 47.25 mills/KWh, and SP15 and Palo Verde each cleared 50 mills/KWh.

Off-peak prices began the week in the high teens to low 20 mills/KWh range, then floated above 30 mills for some trades on Friday.

At Alberta, peak prices boomed to about 460 mills/KWh for one hour on Tuesday. Light-load energy traded for as much as 188.55 mills/KWh, that price paid for the 1 am hour Tuesday morning [Jason Mihos].

Gas Gains on Futures, Oil News

With June futures jumping and the price of crude oil soaring, daily prices in the natural gas market this week marched upward. Reports from the federal Energy Information Administration showed a net increase in stored gas supplies, but market players are still concerned about inventory as summer approaches.

The cost of a barrel of crude oil pushed past $28 this week in response to the bombing attacks reported in Saudi Arabia; traders are worried that another such incident could be directed at oil operations. Those fears appeared to chase the price of gas futures on the NYMEX exchange, which rode higher following the news.

According to EIA figures released Thursday, the amount of gas in storage totaled 900 Bcf for the previous week, an increase of 72 Bcf. The overall amount sits 542 Bcf below the five-year average for stored gas.

Prices at Western hubs powered past the $5 mark, and premiums at the Permian Basin and Pacific Gas & Electric's CityGate neared $6/MMBtu. Permian trades topped out at $5.85/MMBtu, with CityGate matching that price.

San Juan gas, having held in the $3 and $4/MMBtu range in recent weeks, glided up to $5.40. Prices at Topock reached $5.74, and supplies at Malin drew as much as $5.62/MMBtu.

At the Alberta hub, prices stretched from $5 to $5.29 after finishing off last week at $4.89/MMBtu [J.M.].

Western Electricity Prices
Week of May 12-16, 2003
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 35.99-460.7 10.11-188.55
Mid-Columbia 30.25-40 17.25-31
COB 33.75-42 22.45-29
NP 15 38.25-47.25 19-30.75
SP 15 43.75-53.75 18-33.75
Palo Verde 40.9-53 17-35.75

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


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