Western Price Survey / Archives
September 6, 2002
After something of a touch-and-go week for Southern California utility schedulers, the direct threat of fires near Path 26 transmission lines diminished with some welcome rains. The change in weather also brought a steep drop to temperatures and electric consumption, such that Thursday's load charts for California flattened at 33,000 MW beginning around 10 am. With the resulting peak demand coming in about 2,000 MW less than projected, the California Independent System Operator called an early end to the "no touch" alert that had been in effect.
Path 26 comprises three 500 KV lines along the Midway/Vincent corridor near Bakersfield and is a key conduit for Southern California Edison to take power from the AC Intertie and many of its independent power producers. The fires earlier in the week directly damaged Line No. 1, said Cal-ISO spokesperson Gregg Fishman, and caused two of the three lines to be taken out of service on Tuesday.
By Thursday, Line No. 1 had gotten a temporary patch job to damaged conductors, allowing crews to perform cleanup on smoke damaged No. 2. When the washing is completed, No. 2 will return to service, allowing for more permanent repairs to No. 1.
At one point, transfers on Path 26 were limited to 500 MW and real-time prices logged by Cal-ISO jumped to the $91.87/MWh cap. The cap had also been hit on Tuesday when Cal-ISO's peak load climbed to 40,800 MW.
With operators under orders to "do whatever is necessary" to restore balance on the system, Edison enacted curtailments of service to about 700 MW of interruptible customers. The hot weather turned what normally would be a low-demand Labor Day into a "record holiday load" for Edison.
There were other system disruptions as well this week. On Sunday, fires near the Captain Jack/Olinda lines in Oregon caused the California/Oregon Intertie to overload. Lightning strikes in Alberta caused transmission lines to relay, separating the Alberta system from the rest of the grid on two occasions. Then on Wednesday, Arizona Public Service requested 100 MW emergency assistance from Cal-ISO for about three hours.
With "no touch" notices in effect much of the week, the list of power plant outages dropped below 5,000 MW midweek. But as problems cooled, the figure moved back up to 6,400 MW Thursday. Several units that depend on Path 26 were taken out of service, including 750 MW at Morro Bay and the 320 MW Sunrise station. Diablo Canyon No. 1, also a ZP26 resource, has been operating at 98 percent for the past two weeks for other reasons.
Though nuke generation at San Onofre and Columbia Generating Station had been reduced during the holidays for scheduled maintenance, output was back to normal later in the week.
despite all the turmoil, prescheduled power pricing never gained much traction. The high price point was Mead at 36.5 mills/KWh on Thursday. Otherwise, Palo Verde and SP15 topped out at 36 mills/KWh midweek but slipped to the 30.5 mills to 35 mills range for Friday/Saturday deliveries.
The California transmission constraints managed to lock power in the Northwest, and Mid-Columbia fell to the 20 mills to 21 mills range after starting the week at 26 mils/KWh. Off-peak power ended up being not much different than weekend heavy load at 19 mills to 19.25 mills, traders said. Bonneville Power Administration held its daily offer steady at 400 MW day and night through next Monday.
The California/Oregon Border price had been steady between 27 mills and 28 mills but dropped to 25 mills/KWh. NP15 eased to the 29.5 mills to 31 mills/KWh range [Arthur O'Donnell].
Boost in Trading Pulls Gas Higher
Natural gas markets showed an upward trend this week, but largely it was a matter of perception. After starting out the week with extremely low prices because of Labor Day, the burst of unexpected hot weather and transmission problems in Southern California propelled prices above $3/MMBtu at the SoCal Border, the SF CityGate and in the Permian Basin. Pricing at all three points was closely related in the 2.90 to $3.04/MMBtu range beginning Tuesday and trading volumes appeared strong.
Trailing the pack by $0.10 to $0.15/MMBtu were Malin prices, while the San Juan Basin price showed uncertain footing. From a holiday low of $1.78/MMBtu, the San Juan index jumped to $2.70 then slid to about $2.60/MMBtu.
Also weak but trending higher was the Opal producing region price at just a little over $1.00/MMBtu.
Alberta gas costs generally wobbled in the $(C)3.08 to $3.23/Gj range but closed out the week higher at $3.35/Gj [A. O'D.].
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