Western Price Survey / Archives
August 10, 2001
Though schedulers and traders were preparing for a possible system squeeze Wednesday, things turned around in the afternoon and the region sailed through another week of moderate prices despite California hitting its highest peak demand of the summer on Tuesday afternoon.
The 41,200 MW load mark on August 7 was expected to be eclipsed Wednesday by at least another 500 MW, and for a while, it seemed that the California Independent System Operator might need to declare a staged emergency. As the "no touch" day wore on, however, in-state temperatures did not move up as fast as expected, and the system settled for "warning" status beginning at noon.
Thursday's peak came in more than 3,300 MW lower than forecast, hitting just 37,290 MW. Cal-ISO projected an even lower peak for Friday at 35, 700 MW.
Prices had been clinging to the 65 mills to 68 mills/KWh bracket in California and the Northwest, and reached 75 mills/KWh at Palo Verde. But with the possible alert receding, prices plummeted to the low 50s heading into the weekend. Palo Verde slipped below 60 mills/KWh at peak, but with another bout of hot weather forecast for the Southwest next week, it appeared ready to zoom upward again.
Off-peak prices had already dropped from the low 40s to the low 30s, except for Southwest, where overnight prices edged lower to the 28 mills to 30 mills/KWh range.
A healthy resource picture provided the measure of comfort, even as Arizona and Nevada sweltered. There were no major unplanned outages reported aside from a trip at the 700 MW Centralia No. 2 on Tuesday morning. Otherwise, all nuclear units were at or near full capacity and no problems were reported along transmission routes.
The Cal-ISO list of power plant outages varied from 2,700 MW to 4,200 MW but few of those units were missed. Among the usual suspects on the outage list were units at Morro Bay, Redondo, El Segundo, Pittsburg and Encina. Also on the list was DWR's Hyatt Thermolito hydro plant at 120 MW [Arthur O'Donnell].
Steady as She Goes
The biggest shift in the natural gas marketplace came at the Southern California Border, where Topock prices dropped nearly half a dollar after it became obvious that a generation crunch would not occur this week. From a starting point of $3.72/MMBtu on Monday, the border price took big steps downward to $3.28 before a slight rebound brought it to rest at $3.39/MMBtu Thursday.
In comparison, other hubs were stagnant at best. The San Juan Basin wobbled between $2.57 and $2.62/MMBtu while Permian Basin prices eased from $3.04 to $3.00/MMBtu.
That was the going price across the nation, as the Henry Hub index set the pace for most other places.
There was some discrepancy in Northwest prices, as Malin hung out at $3 but Stanfield presented bargains at $2.60/MMBtu. The PG&E CityGate price fell from $3.74 to $3.43/MMBtu as the week progressed. Utility buyers reported very little trading activity.
A slight maintenance curtailment on the PGT system cut deliverability by 100 MMcfd, but no one felt it presented much of a problem.
The Alberta index price barely moved this week at $(C)3.57/Gigajoule until the approaching weekend allowed the price to slip to $3.53/Gj [A. O'D.].
Archives of the Western Price Survey for the past year are also available online.
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