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Western Price Survey

Week's End Edition
October 14, 2011
California Power Prices Gain on Heat, Then Moderate

Higher California temperatures spurred demand and boosted Western prices in an otherwise lackluster domestic energy market.

At midweek, peak-power prices in Southern Cali-fornia jumped by $10/MWh compared with the previ-ous Wednesday as temperatures soared, but prices in the Northwest moved little.

When looking at the Oct. 7 to Oct. 14 trading period, however, peak-power prices were only slightly up at Western hubs:

  • Mid-C: Gained about $1.20 to about $25.85/MWh.
  • California-Oregon Border: Up a dollar to roughly $27.20/MWh.
  • NP15: Posted only one day's trades; traded for about $36.60/MWh Oct. 11.
  • SP15: Gained $2.80 to roughly $35.60/MWh.
  • Palo Verde: Up $2.45 to about $35.75/MWh.

Over the same trading period, nighttime average prices at Western hubs posted modest gains of between 4 cents and almost $2/MWh. Average prices by Friday ranged from roughly $24 to $25.50/MWh (see chart).

In the natural gas markets, the U.S. Energy Infor-mation Administration reported Oct. 12 that moderate weather across most of the United States helped push prices down by midweek. Pricing points in California, however, posted relatively large intraweek increases as hot weather entered Southern California. Natural gas exports to Mexico also fell during the week by about 18 percent, possibly the result of increasing competition to serve the California and Southwest markets. California markets also provided pricing support for Rockies gas.

For the Oct. 7 to Oct. 14 trading period, here's how prices at some Western gas hubs performed:

  • SoCal Border: Up 23 cents to $3.43/MMBtu.
  • PG&E CityGate: Gained 15 cents to $3.58.
  • Ruby-Malin: Up 32 cents to $3.33/MMBtu.
  • Malin: Up 27 cents to $3.31/MMBtu.

Working gas in storage was 3,521 Bcf as of Oct. 7, according to EIA estimates, a net increase of 112 Bcf from the previous week. This marks the largest net injection since the week ending June 12, 2009. Stocks were 56 Bcf less than last year at this time and 68 Bcf above the five-year average.

"Coming on the heels of two other weeks with very large injections, this build shows that stocks are growing quickly during a period of mild weather," the EIA noted in its weekly report.

What's ahead: Peak demand on the Cal-ISO grid reached 36,376 MW the afternoon of Oct. 13, the week's high. The next uptick in demand should occur Oct. 17 with peak use of 33,250 MW. A high-pressure system entering the Northwest Monday brings warmer conditions to Seattle and clear skies to Portland. Temperatures in the Seattle area may reach into the 70s Tuesday. Portland may dip into the 60s by Wednesday. The San Francisco area expects transient warming early in the week, with rain possible Tuesday and/or Wednesday and temperatures aligned with seasonal norms. Los Angeles' forecast states the region should be pleasant most of the week, although milder temperatures are anticipated Wednesday [Linda Dailey Paulson].

Western Electricity Prices
Week's End: October 10 - 14, 2011
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 17.74-360.40 13.43-43.37
Mid-Columbia 22-26.50 21.50-25.75
COB 25.25-28 24-27
NP 15* 36.50-37.10 23.50-24.75
SP 15* 33.50-41.95 21.50-27
Palo Verde 32.75-39.25 20.75-27.75

* Prices represent both day-ahead locational marginal prices (financial swaps, or EZ Gen DA LMPs) and quasi-swap prices (EZ Gen) as reported by ICE.

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 Chris Raphael, editor with questions regarding Price Survey Content.

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