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Western Price Survey / Archives

September 12, 2003
Prices Move Higher on Expectation of Weekend Heat

During the early part of the week, it seemed that temperatures throughout the West would slip downward as the week progressed, taking electricity prices with them. By Wednesday it was clear that a warming trend was moving through California, buoying trade prices at most hubs. This was evinced most clearly by the lack of a price drop for the lower demand typical in trading for weekend delivery.

For example, peak power at NP15 traded for between 47.50 mills and 51 mills/KWh on Monday, remained in that region throughout the week, then was pushed up to the 51 mills to 54 mills/KWh on Thursday for next-day delivery. Off-peak deliveries at that hub stayed in the 34.50 mills to 37 mills/KWh range throughout the week, but then soared as high at 41.50 mills/KWh on Friday. SP15 power followed a similar pattern this week, sticking to the high forties for most of the week then reaching for the 50 mills to 53.50 mills/KWh territory on Thursday and reached 41.50 mills/KWh for off-peak deliveries this coming Sunday and Monday.

In contrast, relatively cool temperatures in the Southwest prevented Palo Verde prices from generating much of a rally all week. Peak power moved for between 42 mills and 47.50 mills/KWh at the beginning of the week. That range narrow to between 43 mills and 44.25 mills/KWh by the end of the week while off-peak power at the hub sank to the 30 mills to 32 mills/KWh on Thursday. Low-demand power perked up at the hub on Friday, topping out at 38.25 mills/KWh.

Prices throughout the West did not feel the pinch of any nuclear plant curtailment as all units in the region remained at full output throughout the week. Generation facility outages, planned or forced, also played little role in the drama-less supply-and-demand activities of the week. For instance, the California Independent System Operator reported about 2,700 MW off line on Wednesday, and that less-than-overwhelming number dropped to under 2,000 MW by the following day.

Aside from units continuing on forced-outage status from last week, the only blips on the Cal-ISO outage report were the short-lived curtailment of all 755 MW of Duke Energy's Moss Landing No. 7 unit and AES' 485 MW Alamitos No. 6 unit. The carry-overs from last week included El Segundo No. 3, Etiwanda No. 4, Hunters Point No. 4 and La Paloma No. 1. The 335 MW El Segundo unit was taken out of the sick bay on Wednesday evening after a few weeks of being under the weather.

By Friday morning, La Paloma No. 1 was no longer on the Cal-ISO list of down plants but was replaced on the list by the 235 MW unit No. 4, which was classified as on planned outage. Potrero No. 3 also showed up on the list at the end of the week, with its 206 MW capacity curtailed by 159 MW.

The Western Electricity Coordinating Council reported the California/Oregon Intertie curtailed to 2,650 MW in the north-to-south direction and 2,450 MW south-to- north for about 9 hours on Wednesday because of a scheduled outage on the Olinda/Tracy 500 KV line. The Captain Jack/Olinda 500 KV line was also out most of the day for maintenance work [Shauna O'Donnell].

Leavening Lacking in Natural Gas Prices this Week

Prices of natural gas for next-day delivery did not get much of a work-out this week, tracking the prior week's fairly closely. Basin and border prices remained unresponsive to the possible increased demand from electricity generating units because of the warming trend in California throughout the week.

The only real volatility was seen at SF CityGate, which hovered in the $4.90/MMBtu range in the early part of the week, breached the $5.00 mark on Thursday — hitting a high of $5.04/MMBtu--then tapered to between $4.815 and $4.86/MMBtu on Friday.

Storage numbers released by the Energy Information Administration on Thursday drove NYMEX futures prices lower, as the federal agency announced that 97 Bcf of gas had been injected into storage the week ending September 5. The EIA also confidently predicted that the goal of having 3 Tcf in storage by November 1 could be attained. "Barring any disruptions, aggregate working gas storage is expected to reach 3 Tcf by the end of October," said the EIA [S O'D.].

Western Electricity Prices
Week of September 8-12, 2003
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 10.37-250.65 9.98-75.24
Mid-Columbia 41.75-45 33.50-39.50
COB 43.50-48.50 35-36.50
NP 15 44.50-54 34-41.50
SP 15 45.25-53.40 34.50-41.50
Palo Verde 41.50-52 30-38.25

Archives of the Western Price Survey for the past year are also available online.

The Western Price Survey is excerpted from Energy NewsData's comprehensive regional news services. See for yourself how NewsData reporters put events in an accurate and meaningful context -- request a sample of either or both California Energy Markets and Clearing Up.

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Contact Shauna O'Donnell, editor with questions regarding Price Survey Content.

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