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Western Price Survey

Week's End Edition
June 21, 2013
Power Prices Follow Gas Lower

Greater-than-expected additions to natural gas storage this week weighed down energy prices. Although Western natural gas prices managed to eke out a bit more value by Friday, regional power prices moved lower in the June 14 to June 21 trading period.

Working gas in storage reached 2,438 Bcf as of Friday, June 14, according to U.S. Energy Information Administration estimates, a net increase of 91 Bcf from the previous week.

Storage levels are now 18.7 percent less than a year ago and 1.9 percent below the five-year average.

The addition to storage was, once again, slightly greater than the market consensus, the EIA and Barclays analysts noted. This placed downward pressure on prices on Thursday in particular.

The natural gas figures indicate less coal-to-gas displacement for power generation and, they say, national gas inventories remain on track to end the injection season at 3.8 Tcf.

Henry Hub natural gas values gained 9 cents since last Friday, trading today at $3.85/MMBtu. Western prices, however, posted nominal gains in the trading period with PG&E CityGate and Malin natural gas values up 3 cents, trading at $3.85/MMBtu and $3.60/MMBtu, respectively. Southern California Border gas traded up a cent to $3.73/MMBtu by Friday.

Meanwhile, average prices for peak power dropped a few dollars at most Western hubs since last Friday:

  • Mid-Columbia: Fell $3.35 to $29.50/MWh.
  • California-Oregon Border: Dropped $2.85 to $32.25/MWh.
  • North of Path 15: Down $1.25 to $37.75/MWh today.
  • South of Path 15: Lost $2.20 to $41.30/MWh.
  • Palo Verde: Added 10 cents to $35.95/MWh.

For off-peak prices, Pacific Northwest hubs dropped $5 to $6/MWh on average since last Friday while Palo Verde off-peak power rose $2.30. Off-peak values today ranged from $19/MWh at COB to $35.70 at SP15.

Peak demand on the Cal-ISO grid reached 34,044 MW Monday, which was the week's high, according to the grid operator. The next peak in demand is forecast to occur Thursday, June 27, when use should reach 38,956 MW. Northwest Power Pool peak demand reached 53,256 MW June 17, up about 2,100 MW compared to Monday, June 10.

Solar power on the Cal-ISO grid has been peaking past 2,000 MW this week as the area sees more solar projects come online. Wind generation in Cal-ISO has been over 3,700 MW on some days. Meanwhile, the Bonneville Power Administration has recorded wind peaks past 4,000 MW this week, with hydro moving from about 7,000 MW during off-peak to more than 12,000 MW at peak.

What's ahead: Showers are expected from Washington into Northern California Monday, June 24. An increased probability of above-normal temperatures from Washington into Southern California and Arizona is expected between June 26 and July 4, according to the National Weather Service [Linda Dailey Paulson].

Western Electricity Prices
Week's End: June 17 - 21, 2013
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 17.70-989.95 12.48-57.38
Mid-Columbia 27.50-33 14.70-27
COB 30-34.50 18-25
NP 15* 37.75-39.75 28.50-30
SP 15* 41-44 29-36
Palo Verde 34.50-38 23-31

* 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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