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Western Price Survey

Week's End Edition
September 14, 2007
With End of Summer Nigh, Peak Power Prices Edge Down Across West

Power traders in the West seem to think that the dog days of summer are behind us, leaving wholesale peak prices down at all the Western hubs this week. Off-peak prices also fell until Friday, when they regained a lot of ground all over the West.

In the desert Southwest, where Phoenix is the only major Western load center holding on to temperatures above 100 degrees, prices for peak power lost all their value this week after only a minor uptick Tuesday. Palo Verde peak prices started Monday averaging about $61/MWh across a $10 spread. That gap closed all week long as the average slowly dropped to Friday's $60/MWh. Off-peak power prices traded around $33/MWh through Thursday before jumping to almost $42 in Friday's trading.

The picture at South of Path 15 was similar. Heavy power traded in $2/MWh increments each day, moving up $2/MWh Tuesday after starting the week at about $60/MWh, and settling just below $60 Friday. Average off-peak prices at the hub moved slowly higher during each day this week before spiking to $46/MWh on Friday.

North of Path 15 trading followed regional patterns, with peak prices never spread more than $3/MWh any day this week, but lost about $3/MWh overall, falling from about $63 to $60. Off-peak prices at the hub inched mostly higher, from Monday's average of $38.50/MWh to about $39 Thursday before jumping to almost $44/MWh Friday.

Cool temperatures and some clouds are moving through Washington and Oregon, which helped push down day-time power values in the region more sharply than in California.

At the California-Oregon Border hub, average heavy prices dropped about $7/MWh from $68 on Monday. Light power prices fell $4/MWh through Thursday, but ended the week almost $4 ahead thanks to the Friday spike.

Peak prices at the Mid-Columbia hub followed those at COB, falling $7/MWh overall. Nighttime power trading at the hub lost about $3/MWh on average through Thursday before spiking Friday to gain about $3.

Temperatures next week are not expected to reach above the 80s in the region except in Phoenix, where highs in the upper 90s are forecast. Los Angeles should be in the low 70s, as will Portland. Forecasters predict Seattle's highs to dip to the mid-60s. The outlook there also includes rain in the first part of the week [Charles Redell].

Storage Injection Calms Worries Over Attack on Mexican Pipelines

An attack on Mexican pipelines Monday contributed to sharply higher natural gas prices Tuesday. According to reports, the attacks in the Mexican state of Veracruz cut off around 25 percent of the country's natural gas supply for 36 hours.

Prices stayed high Wednesday, but began dropping Thursday ahead of the weekly report from the U.S. Energy In-formation Administration, which said that the East and West regions injected natural gas into the nation's stores last week.

According to the EIA's report, the West injected 2 Bcf and the East contributed 50 Bcf to U.S. gas stores last week, bringing the total to 3,069 Bcf overall.

Natural gas prices at the Permian Basin in Texas started Monday averaging about $5.25/MMBtu, jumped to $5.75 Tuesday and eased slightly Wednesday before closing the week at $5.45/MMBtu.

At the San Juan Basin in New Mexico, prices followed a similar pattern. Monday's average trade was $5.20/MMBtu, followed by a hike to $5.70 for Tuesday before a slow decline to around $5.35/MMBtu on Friday.

In Southern California, average prices jumped from about $5.35/MMBtu Monday to $5.80 Tuesday. They held steady Wednesday and even climbed a bit Thursday before settling around $5.70 on Friday

Even traders at the Malin, Ore., hub couldn't resist the Tuesday price spike. Average prices jumped from $5.30/MMBtu Monday to $5.70 Tuesday. Prices held firm Wednesday and climbed a few cents Thursday before dropping back to around $5.65/MMBtu Friday [C. R.].

Western Electricity Prices
Week's End: September 10 - 14, 2007
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 27.92-275.06 25.06-135.08
Mid-Columbia 51.25-63.25 39-51.25
COB 58-70 37.25-49.75
NP 15 58-64.75 27.75-46.50
SP 15 58-64.25 36.25-47
Palo Verde 56.50-66 29.75-43

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 Chris Raphael, editor with questions regarding Price Survey Content.

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