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Western Price Survey / Archives

October 5, 2001
Cool Breezes Deflate Market

California's last burst of hot weather hit the state over the past weekend but quickly dissipated, leaving utilities with extra power and nowhere to send it. Though it seemed that the high pressure system might extend through the week, that all changed by Wednesday as coastal fog blanketed San Francisco and Delta breezes blustered their way through the Sacramento Valley.

Prices were as mixed as the weather. From a high point on Tuesday of about 30 mills/KWh at several hubs, things cooled down considerably to the 22 mills to 23.5 mills/KWh level from COB to Palo Verde.

Mid-Columbia had been lagging the market anyway, and gave back its mid-week gains to settle at 21 mills for peak power. Off-peak energy in the Northwest slipped a bit but was in the 17 mills to 17.5 mills/KWh range.

NP15 followed the late week trend down to 23.5 mills, and SP15 tagged along. Non-firm energy generally undercut the firm prices, signaling surplus sales.

Cal-ISO's peak load hit 38,600 MW on Monday-nearly 3,000 MW higher than the day-ahead forecasts or morning load schedules had called for- leading to concerns that the growing outage roster might lead to a squeeze this month. However, the peaks plummeted to the 32,600 MW level Thursday and were projected to hit just 31,100 MW on Friday. Most traders expect that will be the last gasp of late summer. Any demand drivers in the near term are expected to be heating load in the north, not cooling loads.

The outage list was up to about 6,500 MW, with almost 2,000 MW of hydro out for repairs and pre-winter preparations. Among the larger units reported out were the 407 MW Helms pumped-storage Unit No. 2; 150 MW at Edison's Big Creek pumped unit; 220 MW at Middle Fork/Ralston; and 97 MW at Folsom No. 7. Unplanned outages were reported at DWR's Hyatt/Thermalito, taking 500 MW of 900 MW out of service. Also Pine Flats had 177 MW out and San Luis was down by 110 MW.

Among thermal generation units, the big ticket item is the 1,200 MW Palo Verde No. 3, which entered a month-long refueling outage last weekend. A San Juan unit was also reported out starting on Wednesday morning [Arthur O'Donnell].

Gas Rises on Varied Factors

After several weeks at remarkably low levels, the natural gas market showed signs of life and prices at key hubs rose by more than $0.40/MMBtu this week. Part of the reason was a last burst of heat in California and the Southwest that required generation fuel-partly to make up for the outage at a Palo Verde nuclear unit. Also, cooler nights drove temperatures below the freezing level in some inland parts of the Pacific Northwest, and customers cranked up their furnaces for the first time this autumn.

Traders also said that a lower than expected storage report from the American Gas Association provided a midweek boost to national benchmark prices-pulling the rest of the West along. AGA had delayed its report, reportedly because of computer virus problems, and when it did issue the survey, it found just 66 Bcf had been newly injected to storage last week. With storage running 20 percent higher than last year, the somewhat lower weekly numbers were not a real concern, just a surprise.

The biggest movement in pricing regionally was recorded at the Permian Basin, largely because of dual draws on supplies from the West and the Midwest. From a starting point of $1.56/MMBtu, the Texas prices approached $2.00/MMBtu. San Juan trailed to the $1.85/MMBtu level and the Topock price finally crossed the $2 border, ending up at $2.11/MMBtu.

Malin hiked from $1.59/MMBtu early in the week to $1.96/MMBtu.

Alberta gas also felt the pull of the Midwest, jumping from $(C) 2.00/Gigajoule to $2.65/Gj in Thursday's trading [A. O'D.].

Western Electricity Prices
Week of October 1-5, 2001
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 26-88 15-25
Mid-Columbia 20-24.5 17-17.5
COB 25-29 18-20
NP 15 24.5-30 17-21.25
SP 15 24.5-30 15-19.5
Palo Verde 24.5-30 13.5-16.5

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


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