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Western Price Survey

Week's End Edition
November 20, 2009
Power Values Inch Higher on Storms and Higher Natural Gas Prices

Western electricity prices continued their trek northward this week, boosted by a string of rain- and snowstorms in the Northwest, a slight uptick in natural gas prices, and anticipation of higher electricity demand on Monday.

Power prices might have ended the week even higher if spot natural gas prices had not retreated. For example, from Monday through Wednesday, trades posted more than a $1/MMBtu increase but then fell back around 80 cents by Friday. Prices ranged Friday from $2.99/MMBtu at San Juan to $3.79 at PG&E CityGate.

Since Monday, trades for California daytime power climbed $4 to $5 to average around $38/MWh at North of Path 15 and South of Path 15. Average trades for nighttime power settled between $29 and $30/MWh at both hubs (see chart).

Palo Verde values for prime power rose $4 to an average of $31.47/MWh, while nighttime deliveries increased $10 to $29.76.

Moderate temperatures kept California's peak power demand practically flat this week. Demand dipped from 30,800 MW on Monday to 30,500 MW on Thursday, the California Independent System Operator reported. Top usage was poised to descend below 30,000 MW Friday.

The southern edge of a storm battering the Northwest roared into Northern California on Friday, bringing rain and high winds. Temperatures will remain in the high 50s in San Francisco through early next week, while Los Angeles and Phoenix will see temperatures creep into the high 70s, according to the National Weather Service.

In the Northwest this week, flooding, mudslides and high winds with gusts of up to 70 mph were reported across the region as a storm battered the area, AccuWeather said. Small power outages were reported, but most were scattered and didn't affect a significant number of people. Through early next week, temperatures will range between the high 40s and low 50s in Portland and Seattle, the National Weather Service said.

Peak and off-peak California-Oregon border prices grew by $6 to average $38.11 and $29.50/MWh, respectively. Mid-Columbia prime trades rose $5 to $34.64/MWh, while average nighttime values eked out a $7 increase to $28.41.

Major western nuclear plants returned to full service this week to ramp up for winter heating demand. The Columbia Generating Station on Tuesday was back at full power after a hydraulic fuel leak was repaired in an O-ring. Diablo Canyon's 1,130 MW second unit returned to service Wednesday after one-third of its reactor fuel and its reactor vessel head were swapped out. The San Onofre Nuclear Generating Station's 1,070 MW second unit remains closed while its two steam generators are replaced. Palo Verde's 1,336 MW second unit is also closed while its reactor head is swapped out.

Natural Gas Continues Record Storage Build

Natural gas inventories grew last week by 20 Bcf to 3.833 Tcf, setting another all-time high. Since Sept. 25, storage has been growing every week, thanks to record domestic production and low demand brought on by a moribund economy. Nationwide, inventories now exceed last year's by 10 percent and the five-year average by 12 percent, according to the U.S. Energy Information Administration.

This was the fifth straight week new storage records were established in all three regions around the country. It is likely the country will soon run out of room to put natural gas -- storage is now at nearly 99 percent of its demonstrated peak capacity of 3.88 Tcf.

Western stockpiles bumped up 3 Bcf to 524 Bcf, and now stand 11 percent higher than in the same period last year and almost 15 percent higher than the five-year average [Kristina Shevory].

Western Electricity Prices
Week's End: November 16 - 20, 2009
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 22.55-435.40 13.13-47.22
Mid-Columbia 25-38 18-30.50
COB 30.50-41 21-32
NP 15* 31.50-43 22-31.50
SP 15* 33.50-44.50 21.50-30.25
Palo Verde 25-38.50 18-32

* 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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