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Western Price Survey

Week's End Edition
October 19, 2012
California Power Prices Cool Off

After a temporary boost from hot weather, California power prices fell in the Oct. 12 to Oct. 19 trading period.

Hotter weather in Southern California caused peak-power prices at South of Path 15 to jump at midweek to $60/MWh and pushed North of Path 15 up to around $46. Both hubs steadily fell back over the next two days.

Here's how peak-power values fared since last Friday:

  • Mid-Columbia: Jumped $5.05 to $40/MWh.
  • California-Oregon Border: Up about 75 cents to $39.60/MWh.
  • North of Path 15: Lost $5.05 to $37.75/MWh.
  • Palo Verde: Down $1.55 to $34.15/MWh.
  • South of Path 15: Dropped $3.95 to $39.65/MWh.

Off-peak prices moved nominally over the trading period, finishing Friday from $29.10/MWh at Palo Verde to $30.85/MWh at the California-Oregon Border.

Working gas in storage reached 3,776 Bcf as of Oct. 12, according to U.S. Energy Information Administration estimates, a net increase of 51 Bcf compared with the previous week.

Storage levels are now 5 percent higher than a year ago and 7.1 percent above the five-year average.

Henry Hub natural gas values gained 6 cents since last Friday, trading Oct. 19 at $3.43/MMBtu. Western prices generally followed suit. PG&E CityGate added 9 cents to trade at $4.15/MMBtu, while Malin and Ruby-Malin natural gas rose pennies, ending Friday at $3.53/MMBtu. Southern California Border gas proved the exception, shedding 2 cents over the trading period to end at $3.60/MMBtu.

In its Oct. 18 commodities report, Barclays analysts said a rally in Henry Hub futures "will likely be longer lived than the previous two injection season rallies, but should eventually come under pressure barring any extreme cold weather during the winter."

"At the moment, prices are riding on a wave of much-improved market sentiment, which we believe could be sustained for quite some time since storage anxieties have disappeared," the report stated.

By Friday, Henry Hub futures were trading at $3.58/MMBtu. Futures prices for 2013 are nearing the $4/MMBtu price point, which Barclays says may be sustained for a while.

Peak demand on the Cal-ISO grid reached 35,626 MW Wednesday, Oct. 17, which was the week's high. Northwest Power Pool demand reached 49,436 MW Wednesday.

What's ahead: Showers are possible across the Pacific Northwest and Northern California through Thursday, Oct. 25. Seattle and Portland temperatures should be in the 50s, while San Francisco can expect highs in the low 60s through Thursday. Increasingly warmer weather is expected for the Los Angeles area, with airport temperatures of 70 °F anticipated Thursday, while the downtown daytime high could reach 77 °F [Linda Dailey Paulson].

Western Electricity Prices
Week's End: October 15 - 19, 2012
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 15.65-335.50 12.20-33.75
Mid-Columbia 30.25-45 25-32
COB 33.25-46.25 26.50-32
NP 15* 37.75-46.50 28.75-30.50
SP 15* 38.25-60 28-34.50
Palo Verde 32-39.25 24.50-29.50

* 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.

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Contact Chris Raphael, editor with questions regarding Price Survey Content.

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