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Western Price Survey

Week's End Edition
May 18, 2012
Despite Nuke Outages, Prices Fall

Another Western nuclear facility will go off line when Energy Northwest shuts down the Columbia Generating Station for 10 days of maintenance starting May 20.

The 1,150 MW plant will begin powering down Saturday to allow workers to replace a reactor recirculation pump seal. The part was slated for replacement during a 2013 refueling outage, but noticeable deterioration of the seal prompted action.

"We'd rather replace it now than wait until it fails and then replace it," said utility spokesman John Dobken.

Elsewhere in the West, both units of the San Onofre Nuclear Generating Station remain off line with no set schedule for a return to service. Diablo Canyon Unit 1 remains off line for refueling. And Unit 2 at Diablo Canyon was off line briefly in late April after sea salps entered the plant's intake structure.

Despite the nuclear outages, strong hydro production throughout the West continues to dampen prices during the spring runoff season.

Although the Bonneville Power Administration has not used its oversupply management protocol since May 2, rivers in the region continue running high. Having the Columbia nuclear facility off line decreases the probability that BPA might need to curtail wind power in the days ahead.

"The timing with the BPA water situation works well," Dobken said, referring to the work at Columbia Generating Station.

Over the May 11 to May 18 trading period, the average daytime value for California-Oregon Border power dropped almost $10.40 to $16.15/MWh. Over the same period, Mid-Columbia peak lost about $8.45 to $11.85/MWh; South of Path 15 fell 95 cents to $35.75/MWh; and Palo Verde dropped 10 cents to $30.70/MWh.

Off-peak power values finished the week at averages ranging from around $1.15/MWh at Mid-C to about $23.45/MWh at SP15. Values at Northwest hubs eroded about $4/MWh on average compared with last week.

Meanwhile, spot natural gas prices edged higher in Friday-to-Friday trading. The Henry Hub average spot price for natural gas gained 20 cents over the trading period to $2.56/MMBtu.

At Western hubs, the average spot price for both Malin and Ruby-Malin natural gas jumped 23 cents over the trading period to $2.44/MMBtu, while PG&E CityGate prices rose 11 cents to an average of $2.88/MMBtu. Southern California Border gas was flat, at $2.53/MMBtu Friday.

Working gas in storage reached 2,667 Bcf as of Friday, May 11, according to EIA estimates, a net increase of 61 Bcf from the previous week. Storage levels are now 40.9 percent higher than a year ago and 40.8 percent above the five-year average.

Peak use on the Cal-ISO grid this week reached a 33,254 MW high May 16. Northwest Power Pool demand reached 50,066 MW Tuesday, May 15.

What's ahead: Rain is forecast to return to the Pacific Northwest Monday and could linger in Seattle and Portland through May 24. Sunny weather will resume in the San Francisco area through Thursday, with temperatures near 70. Los Angeles expects temperatures in the 70s into Thursday, while the Phoenix area should have 100-plus-degree weather Monday through Thursday [Linda Dailey Paulson].

Western Electricity Prices
Week's End: May 14 - 18, 2012
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 7.83-861.25 0-26.75
Mid-Columbia 4-18.50 (-)2-3.50
COB 12-25.50 2.50-6.50
NP 15* 26.75-30 14.75-21
SP 15* 30.50-37.25 15.50-24.25
Palo Verde 25.75-31.25 14-22

* 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.

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