Western Price Survey
June 15, 2018
Temperatures exceeding seasonal norms across California increased demand and power prices as residents attempted to cope with the heat.
Demand on the California Independent System Operator grid peaked at 37,491 MW June 13, when hot weather dominated. From Redding to Modesto, temperatures neared or surpassed the century mark. Daytime highs in Needles reached 114 degrees Fahrenheit, while it was 112 F in Palm Springs—roughly 10 degrees higher than seasonal norms.
In some areas, the heat lingered into a second day. Temperatures in El Cajon, for example, stayed around a 94-degree high through June 14. The temperature there tied a 1999 record for that day.
Due to the heat, the U.S. Energy Information Administration had forecast CAISO demand would increase 24 percent on June 14 compared with the previous week, according to EIA data. And although demand did soar—up 5,894 MW, or 19.4 percent—it did not quite meet the EIA forecast.
Total renewables on the CAISO grid reached 16,646 MW June 9, supplying roughly 58 percent of demand. Thermal generation peaked at 16,615 MW June 13, supplying roughly 44 percent of demand.
Western peak power prices jumped between $5.25 and as much as $11.60 in June 7 to June 14 trading. South of Path 15 posted the greatest gain, adding $11.60 to end at $36.60/MWh. Prices traded in a range from $23.30 at Mid-Columbia to $37.75/MWh at Palo Verde.
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Off-peak power values followed suit. Palo Verde added 75 cents to end at $20.75/MWh. Northwest hubs posted the greatest gains, led by Mid-C, which went from $0/MWh for nighttime power to $12.60/MWh.
Meanwhile, working natural gas in storage was 1,913 Bcf as of June 8, according to EIA estimates. This is a net increase of 96 Bcf compared with the previous week. Natural gas storage levels are now 29.1 percent less than a year ago and 21 percent less than the five-year average.
Henry Hub natural gas spot prices gained 2 cents, ending at $2.95/MMBtu in June 7 to June 14 trading.
Western natural gas prices varied in Thursday-to-Thursday trading. While Sumas gas gained the most among Western hubs, up 41 cents to $1.71/MMBtu, El Paso Basin-Permian natural gas lost the most, down 44 cents to $1.88/MMBtu.
Runoff continues to taper across California. It has been below average so far this month for all rivers in the Sierra Nevada, the California Department of Water Resources noted in its final seasonal update. Snow remains on only two of the 120 operational snow sensors as of June 12. Reports resume next February. –Linda Dailey Paulson.
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