Western Price Survey / Archives
November 7, 2003
First the rains fell--for the most part tamping out the devastating fires in Southern California. Then the temperature fell sharply, taking any remaining spirit of an Indian summer with it. Most regions in California reported dropping temperatures that threatened to continue falling as the week wore on. For instance, the forecast had Sacramento at a high of 65 degrees on Thursday, dropping to 59 on Friday. The temperature in San Jose was projected to reach 66 on Thursday but hit only 62 the following day. All in all, the state felt a chill coming on. Rain fell on much of Northern California throughout the week, with showers expected through the weekend. The forecast for the southern portion of the state included overcast skies and some scattered rain. The Northwest shivered in the 40 to 50 degree range this week as well, with some areas of Washington hitting lows well in the sub- freezing range.
The weather factored into the rise in electricity prices at Western hubs this week. The main effect could be seen in the off-peak cost for power, with demand at those hours pushing prices up into the low 30 mills/KWh vicinity throughout the region. By Friday, prices of off-peak power scheduled for Monday delivery reached 40 mills/KWh at some hubs. Off-peak power at NP15 topping out at 40 mills/KWh on Friday. SP15 power followed close behind at 39.50 mills/KWh for off-peak deliveries at the beginning of next week.
Peak power throughout the region rose incrementally during the week. Starting out Monday at between 36 mills and 38 mills/KWh, Mead peak power moved for a high of 44.50 mills/KWh for Thursday delivery. These prices tapered off a mill or two for weekend deliveries.
Loads in the California Independent System Operator's territory remained within the range of the seasonal norm. Both Monday and Tuesday saw peak loads reach a bit more than 30,000 MW. Wednesday was expected to meet that figure but when all was said and done, the peak demand for that day hit a high for the week of 30,856 MW.
A number of generating units were out of service on planned outages for much of the week, including the 175 MW Alamitos No. 1, the 337 MW Contra Costa No. 6 and the 335 MW El Segundo No. 3. Duke's 175 MW South Bay Unit No. 3 also was also briefly out of service on a forced outage Monday.
Tuesday's listing of out-of-service units including the 750 MW Four Corners No. 5 facility. That unit was listed as on a planned outage for the rest of the week. Most unplanned curtailments were partial derates and the supply/demand balance did not seem to suffer any ill effects from generation outages this week. No problems were reported with output from the region's nuclear generating facilities this week. Palo Verde Unit No. 2 remains off line for refueling and some maintenance work but all other units are operating at full capacity.
Speaking of outages, Southern California Edison reported on Thursday that it was continuing to restore power to customers affected by the fires that raged through the utility's territory last week. Edison reported that about 8,000 customers remained with out power by noon November 6. The utility will need to replace an estimated 1,919 utility poles and 736 transformers that were destroyed or damaged by the fires.
In contrast to the last few weeks, when saboteurs and wild fires were threatening transmission, this week the region's transmission system managed to simply experience its usual compliment of curtailments due to a handful of line outages and congestion. In other words, it was back to business as usual for grid managers this week [Shauna O'Donnell].
Cold Comes, Spots Spike
After price indices pegged the wholesale price of natural gas at Western hubs below the $4.00 mark at the beginning of the week, a dose of cold weather moved into the region and breathed a bit of life into the market. Between Monday and Wednesday, prices swelled by anywhere between a dime and half a dollar.
The greatest gains were seen at Permian Basin. Gas traded hands at that hub for as low as $3.69/MMBtu on Monday before moving up to as much as $4.55/MMBtu in Thursday trading. Southern California border gas also realized big gains over the course of the week. Having opened the week as low as $3.79/MMBtu, Topock gas was trading for between $4.50 and $4.85/MMBtu for Friday deliveries.
Damp, cold weather and the expectation of more of the same over the coming weekend drove prices higher in mid- and late-week trading.
The Energy Information Administration report released this past Thursday recorded another injection of natural gas into underground storage facilities for the week ending October 31. This time last year, a withdrawal from storage was recorded. Last week, 34 Bcf was injected into storage throughout the country, 3 Bcf of that total sent underground in the West [S O'D.].
Archives of the Western Price Survey for the past year are also available online.
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