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Western Price Survey

Week's End Edition
September 29, 2006
Fuel Costs Beat Down Power Prices

Relatively mild summer weather across the US has kept a lid on the demand for power and, in turn, the price of natural gas. Spot-market trades of gas at midweek settled for between $3.80 and $4.50/MMBtu. By the end of the week, gas was moving into California for no more than $3.68/MMBtu.

Typically, prices record a little bounce up at the end of the week, in contrast to Thursday prices, which sag for packages to be delivered over the weekend. The drop in gas prices this Friday, however, drew down the price of peak power scheduled for next-week delivery in the West.

In the North of Path 15 region, peak-time power attracted between 45 mills and 49 mills/KWh at the start of the week. The price moved down to 46.75 mills to 48 mills/KWh on Wednesday before skidding to a low of 40 mills/KWh on Friday. Off-peak power at NP15 drew between 30 mills and 32 mills/KWh during the first half of the week. Weekend deliveries traded for between 28.25 mills and 31.50 mills/KWh on Thursday before edging back up to 33.25 mills/KWh on Friday.

Daytime power values in the South of Path 15 region hit a high of 51.25 mills/KWh on Tuesday before fading to a spread of 46.25 mills and 48 mills/KWh the following day. The price of peak power at SP15 went head to head with NP15 power on Friday, closing for between 40 mills and 41 mills/KWh. Nighttime power in the SP15 region changed hands for between 27.75 mills and 33 mills/KWh in the early part of the week.

Meanwhile, the price of peak power in the Northwest stayed mostly within the lower 40s during the Monday-through-Wednesday period. Monday's trades were conducted for between 42 mills and 44 mills/KWh before dropping to a range of 39.50 mills to 41.25 mills/KWh at midweek. The price skidded as low as 36.25 mills/KWh on Friday. Off-peak power moved for as much as 38.50 mills/KWh at the start of the week. By Wednesday the price of low-demand power had eased down to a range of 33 mills to 35.75 mills/KWh and remained at that level the rest of the week.

The availability of power in the Northwest was expanded this week with the return of the Pacific DC Intertie to service in the south-to-north direction. The line had been unavailable in that direction since September 18 because of work on the Celilo converters. On Friday the line was able to transfer 2,084 MW south to north. The PDCI will be out of service in both directions October 16-21 for additional maintenance [Shauna O'Donnell].

Gas Bottoms Out in Late-Week Trading

With a veritable glut of natural gas stored up in the nation's underground facilities and prices on the spot market remaining below the $4 mark at nearly all hubs on Friday, rumblings from producers have begun to suggest increasing shut-in of supply in coming weeks.

Permian Basin gas had to work hard to stay above $4/MMBtu and could not manage to do so for very long. On Thursday and Friday the price ranged from $3.30 to $3.71/MMBtu. San Juan Basin gas bottomed out at between $3.05 and $3.29/MMBtu on Friday.

Natural gas delivered to the Northern California border at Malin attracted a high of $4.20/MMBtu on Tuesday but faded to a range of $3.49 to $3.68/MMBtu at the end of the week. The price for Southern California deliveries weakened as the week wore on as well. Topping out at $4.35/MMBtu on Wednesday, the price dropped to a low of $3.45/MMBtu on Friday [S. O'D.].

Western Electricity Prices
Week's End: September 25 - 29, 2006
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 36.63-186.96 15.79-43.70
Mid-Columbia 36.25-44 31-38.50
COB 38.50-48.20 31.25-38
NP 15 40-49 28.25-33.25
SP 15 39.50-51.25 27.75-33
Palo Verde 34.25-42 23-28.25

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.

Please contact with questions or comments about this site.

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

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