Western Price Survey / Archives
August 16, 2002
Despite an extended high pressure system that spread hot weather from Oregon to New Mexico, the Western electricity market experienced a relatively unremarkable week. "There's not a whole lot of action," said one trader. "It's boring."
An unexpected maintenance outage at Unit No. 1 of the Diablo Canyon nuclear plant last weekend helped bolster Northern California prices, but after the 1,100 MW plant returned to full power Wednesday morning, there was little to hold a floor under the NP15 prices. While the California Independent System Operator started the week with two straight days of restricted maintenance notices, the daily peak demand slid from 40,744 MW on Monday to just 36,300 MW for Friday's forecast.
The Cal-ISO's "no touch" notices brought much of the state's power portfolio into action-whether it was really needed is another issue. On Tuesday, a mere 2,750 MW of units were reported unavailable, with less than 1,000 MW in unscheduled outages. The figures crept up as the sense of alert passed to a total 5.600 MW out of service in full or partial derates on Thursday.
Transmission was generally at or near full, except for a fire along the right-of-way that put the Meridian/Klamath Cogeneration 500 KV line out of service on Tuesday. That caused a brief derate to the DC Intertie from 2,990 MW to 2,204 MW and a reduction in scheduling on the California/Oregon Intertie to 3,500 MW southbound.
COI will be cut to about 2,900 MW southbound over the weekend, but only for part of Saturday, traders said.
Peak prices eased as the week progressed and while off-peak costs seemed to be on the rise midweek, they also ebbed for the Friday/Saturday packages. Bonneville Power Administration maintained its daily surplus offer at 600 MW of daytime and 300 MW of overnight power through Monday.
Though the hot weather and more careful water management pushed Northwest prices to 25 mills early in the week, by Friday, Mid-Columbia was down to the 17 mills to 19.5 mills/KWh range for peak and tipped below 15 mills for off-peak.
California prices had been in the mid- to upper-30s but dropped to 26.5 mills to 27.5 mills at COB, 28.5 to 30.5 mills at NP15 and the 28.5 mills to 32 mills bracket at SP15. Palo Verde and Mead had been as high as 42.5 mills on Tuesday but slid to the 30 mills to 35 mils/KWh range [Arthur O'Donnell].
Gas Follows the Load
The Western natural gas price dynamic was very similar to that of power prices this week, with hot weather bringing expectations of higher loads and a boost in prices early in the week, followed by a quelling of demand and lower costs.
National storage injection figures came in lower than anticipated again this week at 53 Bcf, and national markets were driven by the extreme heat and record power demand in Eastern markets. The West mostly yawned, however, and prices traced a bell curve pattern that mostly ended lower than where they began.
The closest the region came to $3.00 mark was at Topock on Tuesday, but things soon cooled to the $2.70 to $2.78/MMBtu range. San Juan undercut Permian by about $0.15/MMBtu, with the Texas price range stacked above the New Mexico rate.
The SF CityGate had been up to $2.83 at one pint, but it slid to the $2.60 to $2.65/MMBtu range late in the week. Malin dropped a dime to the $2.55 to $2.59/MMBtu vicinity.
Alberta rallied early to $(C)3.11/Gigajoule but closed out the week from $2.92 to $2.96/Gj [A. O'D.].
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