Western Price Survey
Week's End Edition
Special to Western Price Survey Contacts
One thing in California lately is much cheaper than in Texas: wholesale power prices.
ERCOT, which transmits power to 23 million Texas customers, has been breaking peak-demand records thanks to an unrelenting heat wave. Thursday, Aug. 4 was the 34th consecutive day of 100-degree-plus heat in Dallas. The Texas system operator set a new electricity demand record Aug. 4 for a third consecutive day -- 68,294 MW -- with spot peak prices at some hubs exceeding $600/MWh.
In contrast, demand in the remainder of the West remains low and hydro is still plentiful, which has contributed to peak prices less than $40/MWh.
Natural gas prices throughout the United States trended lower for yet another week, which the U.S. Energy Information Administration attributes to the end of the Eastern heat wave, despite the searing Texas weather.
Henry Hub spot prices traded at $4.21/MMBtu Friday, Aug. 5, down 5 cents from the previous Friday.
Western natural gas prices dropped during the trading period. By Friday, Southern California Border gas lost 23 cents over the previous Friday, closing at $4.10/MMBtu. PG&E CityGate gas lost 20 cents, closing at $4.22/MMBtu, and Malin prices were down by 10 cents compared to July 29 values, closing at $3.87/MMBtu. Ruby-Malin gas traded at an average price of $3.88/MMBtu, a 12-cent loss for the new hub over the previous Friday.
Working natural gas in storage rose to 2.758 Tcf by Friday, July 29, after a 44 Bcf net injection, according to the EIA. The amount in storage is now 186 Bcf below last year and 68 Bcf less than the five-year average, according to the agency. This is the fourth consecutive week that injection amounts have been below average.
Here's how average peak-power prices fared over the July 29-Aug. 5 trading period:
Nighttime average prices in California remained less than $30.50/MWh (see chart). Northwestern hubs managed to stay around $18/MWh.
Peak demand on the Cal-ISO grid reached 40,357 MW Tuesday evening, which was the week's high. The next peak in demand should occur Thursday, Aug. 11, when use may near 40,300 MW.
What's ahead: Sunny skies and seasonally normal temperatures are expected in the Pacific Northwest in the week ahead. Temperatures in the low 70s are expected for Seattle, while Portland should near the 80s through Thursday. San Francisco conditions should be mostly sunny and dry, while Southern California starts warming, but temperatures remain cooler than normal. Los Angeles should have temperatures in the 70s, with some inland areas and the deserts reaching triple digits [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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