Western Price Survey
June 23, 2017
Extreme temperatures sent demand soaring the week of June 19; however, ample renewables and demand-response programs helped California cope with conditions.
California Independent System Operator demand reached 44,184 MW June 20, the peak of the heat wave, which was well below the all-time record of 50,270 MW recorded July 27, 2006. Flex alerts and utility demand-response programs reined in demand, according to the grid operator; abundant hydro and new solar generation also helped.
With its six demand-response programs, Pacific Gas & Electric has been able to reduce load by 673 MW, “the size of a large power plant,” said Lynsey Paulo, utility spokesperson.
Total renewables generation on the CAISO grid reached 12,995 MW on June 17. Thermal generation peaked at 25,042 MW June 20.
Arizona saw record power use June 20. With 119-degree heat in Phoenix, Arizona Public Service customers sent peak demand to 7,350 MW, exceeding a 2006 high of 7,256 MW.
The utility temporarily lost generation at the Palo Verde Nuclear Generating Station June 19, the result of a loose wire on a transformer outside Unit 3 that caused a cooling fan to stop working. The unit was fully operational by June 20.
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Daytime power prices soared, with Palo Verde peak power reaching nearly $124/MWh, on average, on June 20. Daytime prices fell as much as $17.20 in the June 16 to June 23 trading period.
In contrast, off-peak values jumped between $5 and as much as $18.65 in trading. Palo Verde saw the greatest increase, adding $18.65 to reach almost $47/MWh. The exception was South of Path 15 nighttime power, which eroded 25 cents.
Meanwhile, working natural gas in storage was 2,770 Bcf as of June 16, according to U.S. Energy Information Administration estimates. This is a net increase of 61 Bcf compared to the previous week.
Storage levels are now 10.5 percent less than a year ago and 8.1 percent greater than the five-year average.
National natural gas consumption rose 2 percent compared to the previous report week. This was driven by gas use for power generation, up 5 percent week over week.
Henry Hub gas spot values shed 7 cents to end at $2.85/MMBtu June 22.
Western natural gas prices varied in June 15 to June 22 trading. Alberta natural gas lost the most value, down 14 cents to $1.65/MMBtu in trading, while PG&E CityGate gas gained 7 cents to $3.15/MMBtu.
What’s next: The heat is expected to move north, with areas of Northern California and Western Oregon expecting daytime highs near or above 100 degrees June 25. Cooler weather is forecast across the region starting June 27. –Linda Dailey Paulson.
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