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Western Price Survey / Archives

September 14, 2001
Power Markets End on Down Note

With trading activity slowly recovering from a stupor induced by the national tragedy, Western power moved down a notch or two heading into the weekend. The absence of significant demand meant that a growing list of generation outages-planned and unscheduled-had little bearing on power availability or prices. Though there were reports of unwarranted retail price hikes for automotive gasoline in the Midwest, there was no such gouging noted in wholesale energy markets. If anything, power traders said, "Everybody is helping each other out."

The highest prices of the week actually were recorded on Monday, but even the top of the market was only around 35 mills/KWh at Palo Verde. Southwest traders said real-time price quotes bumped up to 40 mills on Tuesday after most trading operations shut down in the aftermath of the disaster at the World Trade Center in New York and at the Pentagon in Virginia. There was little to sustain such a price, however, and when traders got back to work on Wednesday, prices across California and the Northwest dropped to the same 27.5 mills to 30 mills/KWh range seen in recent weeks. By the end of trading on Thursday, though, there was a further erosion in pricing for Friday/Saturday packages that pulled the floor down to 26 mills/KWh.

Palo Verde was still above 30 mills for peak power, but made up the difference by discounting off-peak energy to the 18 mills to 20 mills/KWh range.

California power demand, as measured by the Independent System Operator, was low to moderate, reaching 33,500 MW Thursday-pretty much on target with Cal-ISO's day-ahead forecasts. Friday's peak was expected to be about 34,500 MW.

Plant outages ballooned to over 6,450 MW midweek then slipped to 5,600 MW. There was a notable increase in planned outages with almost all of the major generating facilities taking one or more units off line for seasonal maintenance. The outage lists were inflated by the inclusion of Southwestern units at Mohave and Four Corners, where Unit No. 5 continues to be held to about 500 MW because of generator problems. The 790 MW Mohave No. 1 was sporadically available, as was the 740 MW Moss Landing No. 6. On Friday morning, Pacific Gas & Electric reported that Diablo Canyon No. 2 was taken down to 91 percent for repairs of a coolant flow regulator.

At other desert facilities, San Juan No. 3 unit was expected to return to service September 14 after a major turbine overhaul, and Springerville No. 2 remained off line [Arthur O'Donnell].

Gas Compresses on Low Trading Activity

Though it seemed that natural gas prices were on a slight incline midweek, the market turned lower on Thursday on a lack of demand. Whatever gas was flowing seemed to be heading right into storage, and the American Gas Association once again reported higher than anticipated injections this week.

Western storage injections were steady, adding about 10 Bcf into facilities. That brought Western reserves to 428 Bcf, AGA said, representing 85 percent of capacity. Last year at this time, storage levels were slightly above the five-year average at 365 Bcf.

Prices were uncertain all week, especially given the dearth of national benchmarks while NYMEX remained closed. Even at their highest levels, however, Western basin and border prices were at depressed levels and fell even more heading into the weekend.

San Juan Basin prices dropped below $2/MMBtu and Permian Basin gas slipped to $2.16/MMBtu. The Southern California Border/Topock price fell to $2.27 and PG&E/Topock went down to $2.12/MMBtu.

Malin lost a dime, closing out at $2.02 and threatening to creep below $2 over the weekend.

The Alberta index plummeted from $2.92/Gigajoule midweek to as low as $2.55/Gj before settling in between at 2.73/Gj [A. O'D.].

Western Electricity Prices
Week of September 10-14, 2001
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 28-36 10.5-30
Mid-Columbia 26-29.5 23-23.5
COB 26.5-30 23-24
NP 15 28-32.5 22.5-24.5
SP 15 28-30.5 20-21.5
Palo Verde 31-35 18-20

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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