Western Price Survey
August 19, 2016
With cooler weather expected the week starting Aug. 22, Western power prices dropped from recent heat-prompted highs.
Daytime power in the Pacific Northwest, for example, reached roughly $60/MWh at midweek, but fell under $30/MWh by week’s end.
Western peak power prices lost between $11.60 and $22/MWh by Aug. 19. Palo Verde daytime values posted the greatest loss, down $21.95 to $33.75/MWh in Aug. 12 to Aug. 19 trading.
Demand peaked on the CAISO grid at 43,812 MW on Aug. 15, which should be the week’s high.
The grid operator is watching fires across the state. CAISO spokesman Steven Greenlee said the Blue Cut fire, northwest of San Bernardino, is burning near or under a 500 kV transmission line, but two other lines are not threatened at this time. The fire has reportedly destroyed 96 homes and 213 buildings.
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“During the first day of the Blue Cut fire, it tripped a 500 kV, which triggered a sympathy trip of about 1,100 MW solar resources as the voltages in the area fluctuated, but the resources quickly returned to service,” Greenlee said. “Then yesterday we saw a drop of about 800 MW of solar because of smoke covering the area.”
Meanwhile, as a result of the Clayton fire in Lake County, a 60 kV and two 115 kV lines were de-energized for safety. These returned to service on Aug. 18.
Meanwhile, working natural gas in storage was 3,339 Bcf as of Aug. 12, according to U.S. Energy Information Administration estimates. This is a net increase of 22 Bcf compared to the previous week. Western natural gas prices varied, with PG&E CityGate posting the greatest gains, up 9 cents to $3.18/MMBtu (see table).
In contrast, Alberta natural gas prices plunged by 77 cents/MMBtu in the trading period, based on maintenance restrictions and nearly full storage. Natural gas simply hasn’t been able to move out of the province, according to Martin King, vice president of institutional research at Calgary-based FirstEnergy. Between 600 and 800 MMcf/day of natural gas has not been able to move, pushing prices below a dollar.
Alberta prices may remain soft through September and October, King told California Energy Markets, until the start of heating season. Once “the reset button is hit, prices should recover nicely,” he said. [Linda Dailey Paulson].
Archives of the Western Price Survey for the past year are also available online.
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