Western Price Survey
August 15, 2014
Power prices dropped during the week, failing to match last week's heat-prompted high prices. Most hubs posted losses in the Aug. 8-15 trading period, down $1.20 to $6.25. Only South of Path 15 gained nominally, adding 35 cents in the trading period to $53.40/MWh.
Although prices dipped for the week, between Aug. 14 and 15, peak prices added roughly $4 and $9. Mid-Columbia, for example, added $8.90 in that single day. The jump, however, did not enable power prices to surpass last Friday's high prices. Average peak prices ranged from $43.55/MWh at Palo Verde to $53.40 at SP15.
Off-peak prices saw similar movement patterns, with prices moving a few dollars -- only Palo Verde saw an uptick of $2 -- by Aug. 15. Average off-peak prices Friday ranged from $34.90 at Mid-C to $42.50 at North of Path 15.
Working gas in storage reached 2,467 Bcf as of Aug. 8, according to U.S. Energy Information Administration estimates, a net increase of 78 Bcf from the previous week. Storage levels are now 17.7 percent less than a year ago and 18.9 percent less than the five-year average.
Natural gas values tumbled, with Henry Hub gas spot values losing 15 cents since last Thursday, trad-ing Aug. 14 at $3.83/MMBtu. Western prices also fell, with values down between 4 and 13 cents. El Paso-Permian posted the greatest loss, dropping 13 cents to end at $3.82. Stanfield natural gas prices eroded 4 cents, ending at $3.79 Thursday.
In July, natural gas spot prices fell from $4.47/MMBtu to $3.78/MMBtu, with gas inventory additions outpacing historical norms, according to the EIA's August 2014 Short-Term Energy Outlook.
"Natural gas storage injections continue on pace for a record refill of 2.6 trillion cubic feet by the end of October," EIA Administrator Adam Sieminski said. "EIA is raising its forecast for onshore mar-keted natural gas production this year and in 2015, and lowering its natural gas price outlook."
The Henry Hub natural gas spot price -- which averaged $3.73/MMBtu in 2013 -- is now expected to average $4.46 in 2014 and $4 in 2015, according to the report. These new projections are 31 and 51 cents less than the previous month's forecast.
What's ahead: Portland and Seattle temperatures should cool from highs in the 80s Monday, Aug. 18, dipping into the 70s by Aug. 21. San Francisco is forecast to stay in the 60s and 70s the week of the 18th, while Sacramento will near 90 °F by Thursday. Los Angeles should remain in the 80s, while Phoenix forecasts a 103 °F high Monday [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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