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Western Price Survey

May 16, 2014
Grid Operator Watches SoCal Fires

Cal-ISO and utilities are closely monitoring a series of 10 wildfires across San Diego County that threaten power lines across the region.

"The fires overnight did turn and again threaten lines interconnected to the high-voltage system, which we are watching closely," Cal-ISO spokesman Steven Greenlee said Friday. "We have adequate resources in the region to serve load, but if conditions change that put grid reliability at risk, we will issue notifications."

A restricted maintenance-operations order has been in place for the San Diego service area since noon on May 14 as the result of "high loads and temperatures across the Southern CA Region along with threatening fires to ISO facilities."

The wildfires, which have been stoked by high winds, have led to evacuation orders for tens of thousands, according to media reports. Southern California Edison responded to a fire at neighboring Marine Corps Base Camp Pendleton May 14 by stationing employees along the SONGS southern boundary and sending some staff to assist with fire-fighting efforts. The utility also evacuated 13 non-essential employees.

Record-breaking temperatures were recorded across the Western U.S. Wednesday and Thursday. The National Weather Service expects cooler conditions starting May 16. By May 20, Los Angeles should expect temperatures six to 12 degrees below seasonal norms.

Despite the fires, Western peak prices fell between 60 cents and $12.60/MWh on average in Friday-to-Friday trading. By May 16, prices ranged from $35.30/MWh at Mid-Columbia to $47.25 at South of Path 15.

Northwest off-peak power prices also fell sharply in the trading period, losing roughly $19. Average off-peak prices ranged from $3.50/MWh at Mid-C to $40.85/MWh at North of Path 15 (see chart).

Hydro generation in California will be derated by up to 1,669 MW this summer as a result of the severe drought, according to the grid operator's summer assessment. The grid operator expects that additional Cal-ISO generation, along with imports of Northwest hydro and Southwest coal, will help. But it said market conditions this summer could lead to higher natural gas prices and greenhouse-gas emissions.

Working gas in storage reached 1,160 Bcf as of Friday, May 9, according to U.S. Energy Information Administration estimates, a net increase of 105 Bcf from the previous week. Storage levels are now 40.5 percent less than a year ago and 45.3 percent less than the five-year average [Linda Dailey Paulson].

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

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