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Western Price Survey / Archives

June 28, 2002
Fires No Boost to Pre-Holiday Prices

Southern California Edison had to cut 1,450 MW of load on Wednesday evening, and the California Independent System Operator declared another "no touch day" to make sure sufficient generation was on hand, but the disruptions did not have any observable impact on energy prices because trading for the week had already closed out. Schedulers were working off an advanced calendar that had Thursday/Friday packages booked on Wednesday. The end of the month and the upcoming July 4 holiday has put Western trading on an unusual schedule.

With hot weather stretching over the desert and fires threatening Arizona transmission, Palo Verde prices briefly reached 51 mills/KWh but slipped to the 40 mills to 45.5 mills/KWh range during Wednesday's trades. The price at Mead was slightly higher, reflecting the uncertainty premium that still exists for dealings with the financially troubled Nevada Power utility.

The Pacific Northwest continues to find itself with an abundance of hydroelectricity and no place to sell it because of lingering constraints on transmission access to the south. Mid-Columbia peak prices fell from the mid-teens to the 5 mills to 10 mills/KWh range and overnights were 3.5 mills/KWh.

Trades for Saturday delivery showed some of the lowest prices in a decade, with Mid-C selling at less than 3 mills/KWh, according to the Bloomberg index.

The capacity rating on the California/Oregon Intertie has been variable, from 3,200 MW to 4,300 MW during the week but cut to about 2,400 MW this weekend. The DC Intertie was limited to 2,680 MW north-to-south.

The Columbia Generating Station moved back to full output on Tuesday, but was reduced to 85 percent on Friday and awaiting further instructions from the Bonneville Power Administration. Due to the surplus of hydroelectricity, Columbia nuke is the swing resource in the Northwest and has been ramped between 45 percent and 100 percent of its 1,200 MW capacity for several weeks.

Prices in California remain between the two regional extremes, though COB and NP15 appear to be benefiting from NW hydro prices at night, while SP15 aligns more closely to the desert prices. COB at peak centered at 24 mills/KWh in a narrow range, while NP15 was seen settling at 35 mills/KWh after having been above 40 mills earlier in the week. The COB off-peak price was 3.5 mills but NP15 prices ran from 4 mills to 11 mills/KWh. In contrast SP15 showed a 36 mills to 41 mills/KWh range at peak, with overnights in the 8.5 mills vicinity.

California's Independent System Operator had a Tuesday peak demand of 36,400 MW, but loads diminished for the next few days. More peakers stepped up for service and larger plants dropped off the maintenance list. Cal- ISO showed just 4,840 MW of units on the daily maintenance list Thursday.

The Alberta Power Pool hit a rough spot on Tuesday, with prices spiking to the 999 mills/KWh price cap for several consecutive hours. Pool operators said the combination of heat in Alberta, some sporadic transmission line outages and limits on import capability from British Columbia was behind the price run ups. Things appeared back to normal, although Pool loads approached 8,000 MW [Arthur O'Donnell].

Topock Holds to $3, but Hubs Crumple

Natural gas prices gave back whatever gains had been made earlier in the week as traders closed out June books and gave up on any expectations of increased demand from power generators. Although the Southern California Border price gamely held on to prices above $3.06/MMBtu, prices elsewhere in the West tumbled.

The biggest downturns were at Malin and in the San Juan Basin, with each hub reporting a loss of more than $1/MMBtu over the course of the week. San Juan had briefly touched the $3/MMBtu mark but gave back about $0.50/MMBtu each day thereafter, ending the week with trades as low as $1.81/MMBtu.

Malin also collapsed from a high of $2.80 to the $1.72 to $1.80/MMBtu range.

Permian held on to the $2.88 to $3.00/MMBtu range and the San Francisco CityGate slipped from $3.10 to about $2.80/MMBtu.

The Alberta price was on a serious downward course, dropping from $(C)3.23/Gigajoule on Monday to just $1.99/Gj heading into the weekend [A. O'D.].

Western Electricity Prices
Week of June 24-28, 2002
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 10-999 8.3-14
Mid-Columbia 5-15.5 3-5.5
COB 24-28 3.5-8
NP 15 31-40.5 4-11
SP 15 36-45 8.5-12
Palo Verde 39-51 11-12

Archives of the Western Price Survey for the past year are also available online.


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