Western Price Survey
Week's End Edition
Western peak-power prices fell sharply this week after rocketing above $100/MWh during a stifling heat wave that stretched across the western U.S.
California-Oregon Border prices reached a $195/MWh high July 1, while Palo Verde was at $130/MWh.
By July 3, however, average peak prices plunged to between $33 and $50/MWh.
Higher prices in general could stick around for a while. Western energy prices should be 19 percent higher on average this summer compared with 2012, according to a report by ICF International. The analysts also said that "significant congestion on the major paths into Southern California" should continue causing a differential in Northern and Southern California power prices.
Markets were closed Thursday for the July 4 holiday.
Here's how average peak prices at Western hubs fared since Friday, June 28:
Off-peak prices dipped in Friday-to-Friday trading, with losses ranging from $1.15 at Palo Verde to $4.20 at the California-Oregon Border. Off-peak values July 5 ranged from $11.15 at Mid-C to $27.28 at Palo Verde.
Working gas in storage reached 2,605 Bcf as of Friday, June 28, according to U.S. Energy Information Administration estimates, a net increase of 72 Bcf from the previous week. Storage levels are now 15.9 percent less than a year ago and 1.1 percent below the five-year average. Storage estimates were released a day early this week due to the holiday.
This week's natural gas addition was less than expected, which Barclays analysts said balances recent stronger-than-expected injections. "The market remains well supplied ahead of the hottest months of the year, with production still on the rise and the year/year storage deficit firmly on a downward trajectory," they noted in Barclays' weekly commodities report.
Henry Hub natural gas values lost 5 cents since June 28, trading July 5 at $3.52/MMBtu. Western prices were mixed, with PG&E CityGate up 4 cents to $3.77 while Malin gas dropped 10 cents to $3.31 by Friday.
Peak demand on the Cal-ISO grid reached 44,814 MW Monday, the week's high. Northwest Power Pool peak demand reached 62,243 MW Tuesday.
The Pacific Northwest should be in good shape for the summer, according to the Bonneville Power Administration. The most recent water-supply forecast shows runoff at 98 percent of the 30-year average, BPA spokesman Michael Hansen said, "but the rain we received in June has really helped push the runoff number up to near normal." Runoff was 130 percent of average in 2011 and 120 percent of average last year.
What's ahead: The National Weather Service forecasts an increased probability of above-normal temperatures from Washington into Southern California and Arizona from July 10 to July 18 [Linda Dailey Paulson].
* 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.
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