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Western Price Survey

Week's End Edition
November 11, 2011
Natural Gas Prices Stay Low

Although some regions of the country have begun experiencing snow, traders appear to be waiting for even lower temperatures to push natural gas prices above the four-dollar mark.

Natural gas prices dropped Thursday as traders looked to lower weekend demand and considered reports of another significant addition to national natural gas stores. Analysts say natural gas prices are lower thanks to a late start to the heating season and higher production and inventory. Prices below $4/MMBtu are predicted to continue until the onset of colder weather.

Natural gas in storage reached near-record highs. Working gas in storage was 3,831 Bcf as of Nov. 4, according to U.S. Energy Information Administration estimates, a net increase of 37 Bcf from the previous week. Stocks were 6 Bcf less than last year at this time but 215 Bcf above the five-year average of 3,616 Bcf.

Storage inventories are now just 16 Bcf below the all-time monthly high of 3,847 Bcf reached in October 2010, the EIA reported.

In the Nov. 4 to Nov. 11 trading period, Malin gas fell 13 cents, finishing at $3.53/MMBtu. Southern California Border and Ruby-Malin gas eroded 12 cents, finishing at $3.57 and $3.53, respectively. PG&E CityGate lost 11 cents, ending at $3.90/MMBtu.

In observance of Veterans Day, power trades posted Thursday, Nov. 10 were earmarked for Monday delivery. Western peak prices lost a few dollars over the trading period:

  • Mid-C: Down $2.75, ending at around $33.35/MWh.
  • California-Oregon Border: Dropped $4.50 to about $34.70/MWh.
  • NP15: No trades were posted Wednesday or Thursday. Has been trading tightly in the range of $40/MWh.
  • SP15: Lost $2.55 to almost $34.70/MWh.
  • Palo Verde: Dipped roughly $2.20 to $33.75.

Western nighttime average prices dropped across the board. California-Oregon Border prices lost almost $6.40 during the trading period. Average off-peak prices Thursday ranged from $26.20 to around $27.95/MWh (see chart).

Peak demand on the Cal-ISO grid reached 30,569 MW Tuesday evening, which was the week's high. The grid operator predicts the next uptick in use should occur Wednesday, Nov. 16, when demand is forecast to reach 30,204 MW.

What's ahead: Seattle expects temperatures around 50 °F Monday through Thursday, with showers expected into midweek. Late in the week, the region should have lower-than-normal temperatures and greater precipitation than seasonal norms. Cool temperatures and sporadic rain are expected in Portland through midweek. The San Francisco area sees temperatures around 60 °F starting Monday, lasting into Wednesday; however, dry conditions early in the week transition into possible rain starting either Thursday or Friday. Los Angeles-area temperatures should range little during the workweek, although meteorologists say cooler weather is possible late in the week [Linda Dailey Paulson].


Western Electricity Prices
Week's End: November 7 - 11, 2011
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 12.33-999.92 13.09-87.64
Mid-Columbia 32-41.50 25.75-33
COB 34-40 27.25-33
NP 15* 39.75-40.40 29-29.50
SP 15* 34.25-39.25 25.25-29.50
Palo Verde 33-37 23-27.25

* 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.


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

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