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Western Price Survey

Week's End Edition
November 9, 2012
U.S. Gas Storage Reaches New Highs; California Power Prices Fall

U.S. natural gas hit a record for the end of the injection season with 3,923 Bcf in storage as of Oct. 31, according to the U.S. Energy Information Administration.

The agency notes that this amount represents a 3 percent year-over-year increase in end-of-season storage compared to 2011. Western natural gas, meanwhile, also reached an end-of-season record with 546 Bcf in storage.

Gas continued to move into storage as withdrawal season began. For the week ending Nov. 2, working gas in storage reached 3,929 Bcf, a net increase of 21 Bcf from the previous week. Storage levels are now 2.9 percent higher than a year ago and 6.6 percent greater than the five-year average.

The EIA notes there may yet be additions to stocks. "Although the natural gas storage injection season is traditionally defined as April through October, injections into storage have continued into November for the past several years," the agency stated.

In a Nov. 9 report, Barclays analysts observed that "the record level of storage is no longer pressuring prices as the market is no longer concerned with storage running out of capacity."

For the Nov. 2 through Nov. 9 trading period, Henry Hub natural gas values lost 7 cents, falling to $3.33/MMBtu. Western natural gas prices were mixed over the same period. Southern California Border gas lost 5 cents to $3.42/MMBtu, while Malin gas gained 9 cents to $3.41 and PG&E CityGate added 2 cents to $3.70.

Expectations of cold weather moved California peak-power prices lower over the trading period. South of Path 15 average daytime power dropped $10.60 to almost $37.50/MWh.

Here's how average prices for peak power fared at other Western hubs over the trading period:

  • Mid-Columbia: Gained $1.85 to $29.75/MWh.
  • California-Oregon Border: Up $2.15 to $34.10.
  • North of Path 15: Dropped $8.35 to $37.85.
  • Palo Verde: Eroded 80 cents to $27.75/MWh.

Off-peak prices were mixed in Friday-to-Friday trading. Pacific Northwest hubs gained around a dollar, while California hubs dropped as much as $7. Off-peak prices Friday ranged from an average of about $24.80/MWh at Palo Verde to $29.40/MWh at the California-Oregon border.

Peak demand on the Cal-ISO grid hit 32,034 MW Monday, which was the week's high, according to the grid operator. Northwest Power Pool demand reached 54,184 MW Thursday.

The 1,335 MW Unit No. 2 of the Palo Verde Nuclear Generating Station began ramping up generation Nov. 8 after being off line for scheduled refueling and maintenance since Oct. 6. The Nuclear Regulatory Commission reported the plant was operating Friday at 2 percent of capacity.

What's ahead: Seattle and Portland expect rain starting Monday, Nov. 12, and continuing into Thursday. Both regions should have temperatures in the 50s.

A slight chance of rain is possible in the San Francisco area starting late Monday, continuing into Thursday. Bay Area temperatures should be near 60 °F. Light rain is also possible for the greater Los Angeles area starting Wednesday [Linda Dailey Paulson].

Western Electricity Prices
Week's End: November 5 - 9, 2012
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 13.83-980.06 15.79-57.54
Mid-Columbia 24.25-31.75 23-29.50
COB 29.25-36.25 25.50-31.75
NP 15* 36.50-46 28-31.75
SP 15* 36.25-46 27.50-32
Palo Verde 25-33.50 24-26.75

* 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.

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

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