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Western Price Survey / Archives

June 11, 2004
Wilting Western Prices Get End-of-Week Boost

Ample power supplies and low demand took Western power prices on a ride this week. It was a one-way trip downward, as the price of power dropped into the low teens at a few hubs in the region. The only reprieve from the slide came on Friday, when traders moved power for delivery next week.

Diablo Canyon No. 1, which began a refueling out-age the first week in April, is still laboring to ramp up to full output. The outage, originally scheduled to take 45 days, has now gone on for more than 60 days. Last week, a spokesperson for the Pacific Gas & Electric facility said the 1,113 MW unit would be up and running over the weekend, but on Friday it was lingering at 48 percent of capacity.

The 1,108 MW San Onofre Nuclear Generating Station No. 3 unit was shut down in the early morning hours last Friday because of an influx of seaweed brought on by an unusually low tide, said Southern California Edison spokesperson Ray Golden. The unit was back on line by the end of the weekend and showed no ill effects from the incursion of ocean flora on Tuesday. As the two nuclear units made their way back on line, and as other major unit outages remained few, prices dropped. Fast-sinking natural gas prices aided the decline as well.

California power prices, which remained higher than those at other hubs in the West, weakened as the week wore on. NP15 peak power began the week trading for between 46 mills and 53.25 mills/KWh, only to sag to a low of 39.25 mills/KWh on Thursday. Off-peak power at NP15 attracted as much as 30 mills/KWh on Monday before shedding as much as 11 mills in the following days. Friday deals seemed to elicit more enthusiasm from traders, with peak power going for as much as 54.25 mills/KWh for next-Monday delivery. Off-peak electricity attracted between 29.75 mills and 32.50 mills on Friday.

SP15 power prices trailed those at NP15 much of the week. After opening the week at between 46.50 mills and 55 mills/KWh, high-demand power at SP15 sagged to 39 mills/KWh for Friday deliveries. Off-peak power prices strove valiantly to stay above the 20 mills/KWh mark throughout the week, but finally succumbed on Thursday. Low-demand power moved for as little as 16 mills/KWh on that day.

Still, the weakening figures in California must have looked like pillars of strength to Northwest power traders. At Mid-Columbia, the price for off-peak power sank to a meager 8.75 mills/KWh on Thursday, after opening the week in the range of 25.50 mills to 29 mills/KWh. Peak-power prices also buckled as the week wore on, collapsing to the range of 9 mills to 11 mills/KWh on Thursday. At the end of the week, prices for peak power at Mid-C barely moved, drawing a high of only 13.50 mills/KWh. Prices at the hub were pressured significantly by the availability of plentiful hydropower.

California-Oregon Border trades took their fair share of hits during the first three days of the week. Trading for peak power at the hub opened on Monday within the range of 31.50 mills to 42.50 mills/KWh. The spread quickly narrowed, and was cinched on Thursday at a low of 21 mills/KWh. Off-peak power at COB sank as low as a not-so-sweet 16 mills/KWh by midweek.

Loads in the California Independent System Operator territory could muster no more than 30,717 MW of demand early this week. Somewhat warmer weather was expected to roll through California later this week, and demand was expected to rise another 500 to 1,000 MW. With a mere 3,200 MW worth of power generation unavailable for service, however, market fundamentals were expected to keep Western prices low [Shauna O'Donnell].

Gas Loses Ground on Lack of Demand

This week saw a significant drop in the price of natural gas on the spot market, particularly in the West. After lingering in the high $5.00 to $6.00 range for a number of weeks, declines of as much as $1.00/MMBtu were recorded at some hubs. No trading was recorded on Friday because of the holiday noticed by the federal government on account of former Presi-dent Ronald Reagan's death.

Lack of electricity-generation and heat-driven demand contributed to the downward swing in prices.

Permian Basin gas opened the week between $5.55 and $5.60/MMBtu, after reaching a high of $6.25/MMBtu last week. The basin price dropped as low as $5.15/MMBtu on Thursday of this week.

There was little difference in the price of gas between the basin and California delivery points at the end of the week, with Topock gas trading for a low of $5.09/MMBtu.

After starting the week at a high of $5.87/MMBtu, PG&E CityGate gas drew between $5.35 and $5.48/MMBtu in end-of-week trading [S. O'D.].

Western Electricity Prices
June 7 - 11, 2004
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 10.95-136.91 10.80-101.26
Mid-Columbia 8.75-29 9-22
COB 21-42.50 14.25-26.50
NP 15 39.25-54.25 17.75-32.50
SP 15 39-55 16-28
Palo Verde 38.75-54 16-31

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.

Please contact with questions or comments about this site.

Contact Shauna O'Donnell, editor with questions regarding Price Survey Content.

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