Western Price Survey
Week's End Edition
Low demand and cooler weather throughout the West continued to keep power prices low.
Plentiful hydro has diminished the use of natural gas in the West, according to the U.S. Energy Information Administration.
The share of natural-gas-fueled generation in the Western census region was 19 percent in the first quarter -- the smallest first-quarter natural-gas fuel share since 2000. In its July 12 Short-Term Energy Outlook, the EIA stated that it expects natural-gas use for generation to increase as hydro sources dwindle.
On that note, the Bonneville Power Administration's periodic curtailment of non-hydro generation appears to be nearing an end. The agency has posted no reports since July 10. Its curtailment total stands at 97,557 MWh of generation cut since May 18.
Peak demand on the Cal-ISO grid hit 34,366 MW Monday evening. The next high point for demand, 39,900 MW, is anticipated Wednesday, July 20.
The ISO expects a warm summer, but plenty of hydro and more renewables will help meet demand, said Steve Berberich, Cal-ISO's new president and CEO, in a July 6 memo. The high peak load thus far this season was 43,500 MW, recorded July 5, which is far short of the record of more than 50,000 MW recorded in 2006.
Cal-ISO has more than 7,600 MW of operating renewables. Berberich noted, however, that wind during heavy demand days has been contributing only 50 to 100 MW to the grid. Solar had record output of about 488 MW during peak production, and that number will "continue to go up" as more solar becomes operational in the state, Berberich said.
In the Friday-to-Friday trading period, July 8 to July 15, here's how average peak-power prices fared:
Average prices for off-peak power were mixed. California hubs posted losses of between about $3.35 and almost $9.40 in Friday-to-Friday trading. Northwestern prices broke out of negative territory and posted gains of between $3.05 and almost $8.40 by Friday (see chart).
Western natural-gas prices posted modest gains during the trading period. By Friday, July 15, Southern California Border gas earned 9 cents, closing at $4.43/MMBtu. Malin gained 17 cents compared to July 15 prices, closing at $4.23. PG&E CityGate gas jumped 18 cents, closing at $4.62/MMBtu.
What's ahead: In the week ahead, Seattle will have mostly sunny conditions with temperatures just under 70 °F until Thursday. Portland should remain in the mid-70s with some rain possible by midweek. Northern California expects near-normal temperatures in the 70s, while warmer conditions should prevail throughout Southern California. Above-normal temperatures are expected inland, reaching triple digits in the desert [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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