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Western Price Survey

June 15, 2007
Wholesale Prices Rise and Stay Aloft During First Taste of Summer

Welcome to summer. Higher temperatures across the West helped push wholesale power prices up around the West this week. After Thursday's regular dip in prices, peak-power values spiked back up to reach new highs for the week at four of the five Western trading zones.

In California, the state Independent System Operator reported that peak demand, after hovering near 30,000 MW last week, skyrocketed this week. On Thursday, peak demand rose above 40,000 MW for the first time this summer. Average peak power prices at California and Southwestern zones were up around 10 mills/kWh over the week.

At Palo Verde, temperatures on Friday hit 110 degrees and the 1,243 MW Unit No. 1 of the Palo Verde nuclear plant was still off line for planned maintenance. Average peak prices jumped from about 65 mills/kWh Monday to 77 mills/kWh Friday. Nighttime power there also ascended, climbing from about 38 mills/kWh to about 52 mills/kWh Friday.

At South of Path 15, the Western Electricity Coordinating Council reported Friday that the 1,070 MW San Onofre Unit No. 2 nuclear generator would be off line as of Friday night. A call to plant owner Southern California Edison was not returned by press time. Daytime power prices in the zone moved up from an average of 66 mills/kWh Monday to almost 80 mills Friday. Off-peak power prices moved up sharply, moving from about 40 mills/kWh on Monday to about 52 mills/kWh for Monday deliveries.

At North of Path 15 the picture was similar. Temperatures were warmest in the middle of the week, which drove wholesale prices up. The average value of daytime power shot up 10 mills/kWh over the week from 67 mills/kWh Monday. Nighttime power prices also gained 10 mills, trading in the low 40s Monday to the low 50s Friday.

Up north, temperatures stayed cool and showers scattered across Washington and Oregon all week. Heavy power values at the California-Oregon Border zone still gained ground, however. Peak prices moved only about 6 mills/kWh over the week, averaging around 64 mills/kWh in Friday trading. Off-peak prices at the hub moved up solidly, though. On Monday, light power rose almost 13 mills/kWh from 27.50 mills to 40 mills/kWh. By Friday, the price swings largely dissipated and light power averaged 50 mills/kWh.

The Mid-Columbia zone was the only one that couldn't hang on to early-week gains after the normal Thursday price drop. Tuesday's daytime prices reached 56.50 mills/kWh. Average values rose again on Friday after Thursday's decline, but only reached back into the low 50s. Light power prices jumped from the low 20s on Monday to as much as 48 mills/kWh Friday.

In California, temperatures at load centers like Fresno and Sacramento are forecast in the mid- to upper 90s early next week [Charles Redell].

Natural Gas Values Make Only Small Gains During Hot Week

Last week, natural gas stores increased yet again, according to the U.S. Energy Information Administration. For the first time in three weeks, however, injection numbers were only in the double digits, lower than expected. National natural gas stores increased by 92 Bcf last week, with the West gaining 11 Bcf.

Natural gas prices rose most of this week as warmer temperatures across the region drove California's electricity demand.

At the Southern California border, natural gas traded at about $6.70/MMBtu Monday. On Thursday, the average price climbed a few pennies above $7.00/MMBtu before dipping back to $6.75/MMBtu on Friday.

Prices in Texas, at the Permian Basin, followed the same pattern. The average jumped from about $6.65/MMBtu Monday to almost $7.15/MMBtu Thursday before sliding back to about $6.75/MMBtu Friday.

At the San Juan Basin hub in New Mexico, prices moved less predictably this week. There, they started strong at $6.85/MMBtu on Monday and hovered around $6.70 until Friday, when values swung more than 40 cents and averaged about $6.53/MMBtu [C. R.].

Western Electricity Prices
Week's End: June 11 - 15, 2007
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 6.82-175.23 7.21-39
Mid-Columbia 39-56.50 22.25-48
COB 55.50-65 27.50-50.25
NP 15 66-79.75 39.50-54.75
SP 15 64.50-82.50 38.75-54.75
Palo Verde 62-84 35-54.25

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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