Western Price Survey
August 4, 2006
Almost as quickly as regional temperatures and spot power prices rose last week, they retreated entering this week. On Monday, peak demand in the California Independent System Operator territory had sagged to an unremarkable 36,342 MW. At midweek, peak load in the grid manager's control area topped out at just 39,222 MW, significantly lower than last week's peak figure of more than 50,000 MW.
In the North of Path 15 region, peak-time deliveries traded for between 66 mills and 79 mills/KWh on Monday. By Wednesday the price had slipped to a narrow spread of 76.76 mills to 77.75 mills/KWh. NP15 nighttime power on the spot market attracted between 41 mills and 48.50 mills/KWh on Monday and skipped up to 52.75 mills/KWh in midweek trading before dropping below the 50 mills/KWh mark Thursday.
A small recovery in values was recorded across the board on Friday at most Western hubs after the typical droop driven by softer trading on Thursday for weekend power.
Southern California power prices remained close to the range recorded at the end of last week. Closing last Friday at between 68 mills and 80 mills/KWh, daytime power moved through the South of Path 15 hub on Monday for between 70 mills and 80 mills/KWh. After tacking on another mill or so in Tuesday trading, SP15 peak power edged downward on Wednesday to a range of 77 mills to 78 mills/KWh. After bottoming out at a low of 63 mills/KWh on Thursday, next-week deliveries were penciled in from between 70.75 mills and 73.50 mills/KWh on Friday.
California-Oregon border peak-time power attracted as much as 75 mills/KWh during the first half of the week before slipping to a low of 60.75 mills/KWh on Thursday. The price of peak power at COB regained close to 5 mills in Friday's session.
The value of off-peak power at the hub ranged from 45 mills to 47 mills/KWh on Monday before clearing the half-century mark to trade for 51 mills/KWh on Tuesday. By Thursday the price had eased back down to 44.50 mills/KWh.
Northwest power prices hovered in the mid- to upper sixties during the first half of this week. Peak power at Mid-Columbia moved for between 62 mills and 66 mills/KWh at the start of the week and traded for between 67.50 mills and 68 mills/KWh on Wednesday. The price moved as low as 58 mills/KWh for weekend packages before reversing course and closing for between 62.25 mills and 64 mills/KWh on Friday. The price of off-peak power at the Mid-C trading post topped out at 54.50 mills/KWh at the end of the week after spending the prior four days in the upper forties.
Temperatures in the Southwest were comparatively cool this week. In Las Vegas and Phoenix the mercury stayed mostly on the double-digit side of thermometer, exceeding 100 degrees only occasionally. The relatively mild weather kept the price of electricity at the Palo Verde hub from heading into the stratosphere.
Peak-time power at PV changed hands for between 69.25 mills and 80 mills/KWh on Monday and remained within that range in trading during the subsequent two days. Weekend power attracted between 63 mills and 64.50 mills/KWh in Thursday activity before edging up to 68 mills/KWh the following day. Nighttime power at the Southwest hub attracted between 40.75 mills and 46.50 mills/KWh at the start of the week. The price hit 50 mills/KWh on Tuesday before dropping as low as 38 mills/KWh toward the end of the week.
Gas Prices Sigh as East Coast Swelters
With the heat wave moving into the Midwest and East Coast, the electric-generation demand underpinning gas values in the West weakened some this week.
After reaching a high of $7.89/MMBtu on Tuesday, Permian Basin gas lost more than $1 on the spot market over the subsequent three days. The same trend was displayed at the San Juan producing basin as well, where spot gas closed the week trading for between $6.25 and $6.46/MMBtu. The price at the basin peaked at $7.42/MMBtu on Tuesday.
Entering California at the Topock hub, spot gas cost between $6.60 and $7.95/MMBtu this week, settling in the range of $6.65 to $6.85/MMBtu on Friday. Even at their zenith, Western spot prices ran about a buck lower than the day-ahead price recorded at the Henry hub.
Archives of the Western Price Survey for the past year are also available online.
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