Western Price Survey / Archives
July 23, 1999
The Western spot power market appeared to pick up right where it left off last week, with moderate temperatures pulling utility loads and prices to a buyers' comfort zone. Although sellers had tried to pump up advance prices for Monday deliveries, the market could not sustain the action and prices dropped steadily through the week.
The California Power Exchange's daytime clearing price shimmied between 27.5 mills and 33 mills/KWh, ending the week at 30 mills/KWh. Off-peak prices stayed within the 18 mills to 20 mills/KWh range. Loads varied between 612 GWh per day and 634.5 GWh but were on average lower than last week. when record heat and energy consumption drove Northern California into new record demand levels.
Mid-Columbia markets moved hardly at all this week, sticking to the 20 mills to 22 mills/KWh vicinity for peak and narrowing to 15.5 mills to 16 mills/KWh for off-peak power. While Bonneville Power Administration set a price of 22.75 mills to 23 mills/KWh for 200 MW of off-peak surplus power into the weekend, buyers said they had other options at better prices.
Both the California/Oregon Border and Palo Verde dropped into the mid-20s. COB slipped to as low as 22.75 mills/KWh for Friday and Saturday deliveries. Palo Verde and other Southwestern hubs reported prices centering at 27 mills/KWh after starting the week at 35 mills to 42 mills/KWh. But the higher prices were based more on expectations than realities and utility schedulers said that despite a hot center of triple-digit temperatures located over desert communities, overall loads were moderate. Overnight power was 16 mills to 17 mills/KWh at COB and 17 mills to 18 mills/KWh at Palo Verde for much of the week before slipping to about 14 mills to 15 mills/KWh.
In generation-related news, the Palo Verde No. 3 unit was reported at 84 percent on Friday morning, but no explanation for the drop in output was available from operator Arizona Public Service. The 382 MW Ormand Beach No. 1 unit tripped off-line on Wednesday morning, but the outage had no discernable impact on the market. PG&E's 170 MW Hunters Point No. 3 remains out of commission after last week's boiler rupture. Given the transmission constraints into and out of San Francisco, that unit has more of a localized reliability impact than a general market presence [Arthur O'Donnell].
Gas Marketers Seek Direction
The quiet energy marketplace spilled over into natural gas trading, with little movement in prices and relatively low trading activity. "Not a lot of news, not a lot of burn out West," was how one gas trader summed up the week. With gas sales slacking as power generation tailed off, Pacific gas & Electric declared another OFO for the weekend-signaling more gas in the pipeline than demand for it.
The Southern California Border price hung in a range of $2.36 to $2.41/MMBtu most of the week, centering at $2.39/MMBtu. That represented an increase over last weekend's low prices, which fell to about $2.15/MMBtu as demand dropped significantly after the heat wave broke.
The spread between Permian Basin and San Juan Basin prices returned, largely because Midwestern utility demand pulled Texas supplies where they were needed more. San Juan rose slowly from the weekend trough to about $2.09/MMBtu while Permian reached $2.25/MMBtu by the end of the week.
Alberta gas prices advanced from the $(C)2.74/Gigajoule level to close out the week at $2.80/Gj on light trading [A. O'D.].
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