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Western Price Survey

Week's End Edition
June 8, 2012
Rains, Power Prices Fall in Northwest

Recent rains in the Pacific Northwest accelerated hydro production, significantly depressing Western peak and off-peak power prices and reversing gains made the week prior.

Peak hydro production at the Bonneville Power Administration reached 14,850 MW the evening of June 6 after appearing to slacken last week. BPA wind generation reached almost 4,300 MW on June 5, though the agency did not use its Oversupply Management Protocol to curtail any wind turbines.

BPA did ask the 1,170 MW Columbia Generating Station to reduce output to 85 percent of capacity June 7. The plant will continue operating at 85 percent through Sunday, June 10, with full output expected the following day.

"We asked them to go to 85 percent to help reduce the possibility of oversupply given the amount of water in the river and wind forecasted," said BPA's Michael Hansen.

Over the trading period spanning June 1 to June 8, California-Oregon Border peak prices dropped $9.60 to $18.55/MWh Friday while Mid-Columbia daytime prices lost about $6.05, finishing at around $13.25/MWh. Likewise, average prices for off-peak power lost value with COB plummeting $14.70, ending at almost $2.80/MWh, and Mid-C shedding $9.40 to finish at roughly -70 cents/MWh.

Elsewhere in the West, average peak prices at South of Path 15 gained about $3.30 over the trading period to $34.35/MWh, while North of Path 15 peak finished at $31.15/MWh, up about $2.90 compared to last week. Palo Verde peak prices lost 50 cents to $28.25/MWh.

Working gas in storage reached 2,877 Bcf as of Friday, June 1, according to Energy Information Administration estimates, a net increase of 62 Bcf from the previous week. Storage levels are now 32.9 percent higher than a year ago and 31.4 percent above the five-year average.

Spot natural gas prices closed lower on June 8 compared to the previous Friday, with Henry Hub down 2 cents at $2.21/MMBtu. In the West, the average spot price for Southern California Border gas lost 15 cents over the trading period to $2.27/MMBtu, while Malin dropped 12 cents to $2.04/MMBtu, and PG&E CityGate ended 8 cents lower at $2.54.

Peak demand on the Cal-ISO grid hit 32,399 MW Thursday, June 7.

What's ahead: The Phoenix area will remain at or near the century mark with a 108 °F high expected Wednesday, June 13. The Los Angeles and San Francisco areas expect sunny skies Monday through Thursday, with temperatures in the 70s.

Rain no longer dominates the Pacific Northwest forecast the week of June 11. Partly sunny weather is expected into Thursday, save for a passing chance of rain predicted for the Portland area Wednesday. Seattle temperatures are expected to be in the mid-60s during the week, while Portland will hover around the 70-degree mark for the period [Linda Dailey Paulson].

Western Electricity Prices
Week's End: June 4 - 8, 2012
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 8.02-732.15 0-31.76
Mid-Columbia (-)1-14 (-)5.50-4.50
COB 2.50-20.50 (-)0.95-12.50
NP 15* 23.50-33 16.50-21.25
SP 15* 26.75-35.50 15.50-21.50
Palo Verde 24-28.50 13.75-20

* 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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