Western Price Survey / Archives
August 22, 2003
With the electricity market and its watchers still mopping up from last week's huge blackout in the Midwest and East Coast, activities in the West this week were relatively uneventful. The weather throughout the West did not generate much market volatility as temperatures were within seasonal norms in California and neighboring states.
Power supplies in the region were also ample, with the quantity of unavailable power in the California Independent System Operator control area rarely more than 3,000 MW throughout this week. A few generating facilities that have been on forced-outage status for a couple of weeks remained unavailable this week-- Pacific Gas & Electric's 163 MW Hunters Point No. 4 remained off line, as did La Paloma Units No. 2 and No. 3. On Friday morning, both La Paloma Units No. 1 and No. 4 were added to the Cal-ISO outage list, bringing the total amount of power unavailable from La Paloma up to 927 MW. Moss Landing's 510 MW Power Block No. 2 and 755 MW Unit No. 7 were both off line on Monday, the former on a forced outage and the latter on a scheduled outage. Both were up and running later that day.
The up and down nature of nuclear power plant output in the West over the last few weeks abated this week. All units in the region were operating at full output the entire week.
Peak loads within the Cal-ISO control area remained under 40,000 MW throughout the week and the grid operator needed to call on additional incremental and decremental energy bids on numerous occasions. The intrazonal congestion that trigger the calls was on the perennially troubled Path 15. For example, because of intrazonal congestion south of Lugo on Path 15, on Tuesday Cal-ISO called for decremental energy bids north of Lugo and incremental bids south of that location. The following day, the system operator called for decremental bids at both Palo Verde and CFE branch group because of congestion on the Miguel Bank. Incremental energy was called for on Path 15 west of the Miguel Bank. Cal-ISO's OASIS Web site declared regularly throughout the week that local market power mitigation had been triggered.
One of three banks continued to be unavailable at the Vincent Substation. It had been damaged by a fire in March and Path 26 has be derated to about 2,500 MW in the north to south direction ever since. The expected return-to-service date for the damaged bank has been pushed back to September 11 according to the Western Electricity Coordinating Council.
Prices for power followed a predictable trajectory this week--moving from high to low over the course of the five days, with a boost on Friday for next week's deliveries. Monday's opening prices were not ones traders could get particularly excited about as the Southwest hubs just topped 50 mills/KWh and Northwest numbers tracked nearly 10 mills/KWh lower. The Palo Verde price for peak power hovered between 52.50 mills and 53 mills/KWh on Monday, slipping to between 45.25 mills and 46 mills/KWh on Thursday. Next Monday's deliveries from that hub traded up to 53.75 mills/KWh on Friday. Off-peak power traded as high as 43.40 mills/KWh that day, after keeping in the low 30s from Monday to Thursday [Shauna O'Donnell].
Ditto the Week Before
Wholesale Western natural gas prices were, across the board, a notch lower this week when compared to last, but overall, the price spread and movement re-mained consistent; generally speaking, prices moved on a faintly uphill path as the week wore on.
Permian Basin gas began the week between $4.70 and $4.82/MMBtu. By Friday, the commodity was running at a $4.87 to $5.02/MMBtu clip, having steadily increased throughout the week. The price at the Southern California Border hub rose to a high of $5.08/MMBtu on Friday, having gained about $0.23 over the course of the week. Canadian gas prices have strengthened over the last three weeks, keeping to the mid-$4.50/MMBtu range, more robust that about a month ago, went the price dipped below $4.00/MMBtu.
The Energy Information Administration's Thurs-day report of storage numbers showed another healthy injection into storage. Though not as robust as last week's input of 82 Bcf, this week's 78 Bcf injection affirmed market watchers' sense that gas availability would prove adequate this coming winter [S O'D.].
Archives of the Western Price Survey for the past year are also available online.
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