Western Price Survey / Archives
August 20, 1999
Power prices stepped up midweek based on warmer temperatures in Southern California and the Southwest, but any attempt to rally prices to a higher plateau was undercut by a drop in Power Exchange loads and clearing prices as the weekend approached.
The PX daytime price hit a high of 35.8 mills/KWh on Wednesday, then tumbled to 31.5 mills/KWh for Friday deliveries. Though prescheduled PX loads were slightly above average all week, they fell from 643 GWh to 631 GWh, pulling average prices own with it. Following a different trend was the off-peak price, which slowly rose through the week from 18 mills to 21 mills/KWh by Friday.
Similar price trends were reported at all bilateral trading hubs but on narrower spreads. Mid-Columbia moved between 23 mills and 26 mills/KWh midweek, only to fall again. Continuation of above-average river flows kept the Northwest market at a lower price tier than other regions.
The California/Oregon Border price rose and fell between 31 mills and 33 mills/KWh while Palo Verde/Four Corners held between 37 mills and 40 mills/KWh before dropping to 32.5 mills/KWh for weekend deliveries..
Off-peak power was generally reported in the 15 mills to 17 mills/KWh vicinity, except in the Southwest where it rose to 18.5 mills/KWh midweek.
The Alberta Power Pool was experiencing a relatively calm week until Thursday when a jump in pool demand shook prices out of the tight range they had been following. The pool price popped up to 65 mills/KWh as afternoon loads rose above 6700 MW.
Resource-wise there was almost nothing significant to report. Major generating units remained healthy and in service and this week's transmission constraints did not appear to disrupt anyone's market plans.
The WNP-2 nuclear plant drifted down to 85 percent of capacity on its slow descent to a refueling outage in mid-September. Traders cast their eyes forward to the autumn maintenance schedule for the 1067 MW Diablo Canyon No. 2, which is set to take off a month starting September 25 [Arthur O'Donnell].
Gas Prices Pause, Leap Higher
While it appeared that natural gas prices were beginning to crest midweek, it turned out to be only a brief respite before the bull market resumed based on a jump in NYMEX futures prices for September delivery to $2.90/MMBtu.
The NYMEX hike was attributed to Gulf Coast tropical storm warnings and another in this year's series of lower-than-normal gas storage reports.
"People are becoming believers in the bull market," said one trader, who pointed to a more than $0.12/MMBtu jump in prices between Wednesday and Thursday. Though not quite as high as the NYMEX price, delivery prices to the Southern California Border blasted upwards to $2.76/MMBtu this week.
Midwestern and Texas draws from the Permian Basin continued applying pressure on other Southwestern basin costs. Permian prices climbed from $2.55 to $2.74/MMBtu while San Juan followed to $2.55/MMBtu.
Alberta index prices appeared to be cooling down this week after a hot run, but it was merely a pause for better footing before leaping. After slipping to $3.13/Gigajoule on Tuesday, Alberta prices leapt back to the $3.25/Gigajoule mark.
A number of minor gas facility repair outages were reported for upcoming weeks. Perhaps the most significant is a two-month-long curtailment at the Transwestern Pipeline's Kingman Station No. 1. Capacity west of Thoreau will drop from 950 MMCfd to 875 MMcfd while automation equipment is installed. Next month, Transwestern will cut deliveries at the Blanco Hub by 75 MMcfd as crews work on a compressor at Bisti in New Mexico on September 20.
The El Paso natural gas pipeline said it will cut its San Juan deliveries on the Havasu Crossover line by 50 MMcfd on August 30 because of turbine repairs at Ditch Flat [A. O'D.].
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