Western Price Survey
August 9, 2013
Western power prices slowly lost steam during the week on mild weather and falling natural gas values.
Working gas in storage reached 2,941 Bcf as of Friday, Aug. 2, according to U.S. Energy Information Administration estimates, a net increase of 96 Bcf from the previous week. Storage levels are now 9.2 percent less than a year ago and 0.7 percent greater than the five-year average.
Approximately 14 Bcf of the net increase was due to a gas-stocks reclassification by the EIA, including a higher net injection in the West.
Henry Hub natural gas values shed almost 7 cents since last Friday, trading Aug. 9 at $3.32/MMBtu. Western prices moved lower than the national benchmark. Southern California Border gas dropped 18 cents to $3.29, Malin gas lost roughly 15 cents to $3.17 and PG&E CityGate gas was down about 7 cents, trading at $3.53 by Aug. 9.
Meanwhile, Western peak-power prices ended the week mixed. Here's how average peak prices fared in the Aug. 2 to Aug. 9 trading period:
Off-peak values in California and the Northwest seem to be buoyed by less hydro generation. For the week of Aug. 6, 2012, hydro output in the Bonneville Power Administration area peaked at 12,907 MW, but it could not break 10,000 MW this week.
Prices have responded accordingly. Where Mid-C nighttime power traded in a range from $8 to $22/MWh during the Aug. 6 trading week last year, the hub traded between $24 and $27.50/MWh this week. Off-peak prices at California hubs, meanwhile, are trading at about the same level as peak prices (see charts).
What's ahead: Above-normal temperatures are expected in Washington, Oregon and Arizona between Aug. 14 and Aug. 22, according to the National Weather Service. Normal temperatures are forecast for California during that same period [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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