Western Price Survey / Archives
December 10, 1999
The extent of activity in energy markets this week appeared to be only the goose-pimpled grunting of Southwesterners packing themselves into jackets and scarves. The penetrating cold in Arizona did not seem to pump blood into prices at Western hubs, which repeated last week's performance of moderate prices and matching weather conditions. Loads on the California Power Exchange barely crested 550 GWh, with a high of 552.6 GWh for Wednesday and a low of 524 GWh for Monday deliveries.
The average CalPX price held nearly stationary through Friday, venturing just once-up to 32.8 mills-from the 30 to 32 mills/KWh range. On-peak prices moved between 32.2 mills and 35.1 mills between Monday and Friday, hitting a low of 31.9 mills/KWh for Thursday supplies. Prices for light-load hours also traded in a narrow tolerance, barely moving from the 26 mills/KWh vicinity.
"Things are darn quiet," remarked one trader in response to the recumbent market. Excluding the Southwest's current cold snap, temperatures elsewhere in the West were reported to be warmer than usual, adding to mild electricity prices. Anticipation of next week's "Day of the Trader" conference in New Orleans may have caused some market players to lock up their trades early, one trader speculated. Bonneville Power Administration continued to offer 200 MW of its surplus hydro power through Saturday, with Northwest prices for all hours tied to the CalPX average market-clearing premium minus $1 and COB/NOB deliveries priced at the average CalPX price.
Prices at Mid-Columbia were rooted between 28 mills and 30 mills, and trades at the California/Oregon Border held between 32.25 mills and 34 mills/KWh. Off-peak prices at Mid-C eased between 22 mills and 24 mills, and light-load prices at COB appeared stuck at 25 mills/KWh.
Palo Verde and Four Corners kept in stride with each other, each hub hitting a high of 34 mills and each drawing around 22 mills/KWh for off-peak energy. Prices at Midway hung in the low 30 mills/KWh range.
In Southwest generation news, Four Corners Unit 4 returned to service Wednesday, the same day that San Juan Unit 3 ramped down to 50 percent to begin repairs to a boiler feed pump. The generator was expected back by Thursday evening.
In Canada, the Alberta power pool appeared to feel the loss of the Naughton and Hunter power plants in the Northwest as real-time prices soared to a high of 647 mills/KWh. Prices for off-peak hours ran between 21 mills and 30.65 mills/KWh [Jason Mihos].
Patient Gas Market Poised for Surge
Premiums for natural gas at Western hubs this week outpaced futures prices in a market that traders described as both "pretty stable" and "enigmatic." Healthy demand for electric generation, bolstered by strong power prices, helped fuel the market's performance. One unconvinced trader indicated that prices have not yet recovered from their precipitous descent in late November. " Prices aren't weak and they aren't strong. They're hovering just above the NYMEX index, which is pretty low," he said.
The temporary shutdown of a Muddy Creek facility in the Rocky Mountains may have contributed to this week's price activity, though most traders suggested that gas is still stuck in a pre-winter lull. Transactions held in tight ranges at most points. San Juan Basin supplies drew between $2.16 and $2.23/MMBtu, with Permian gas a step behind at $2.14-$2.20/MMBtu.
Trades at PG&E's Citygate point garnered $2.47 to $2.56/MMBtu, while prices at Malin, supported by Citygate's premiums, pushed up from $2.34 to $2.40/MMBtu. Topock gas traded between $2.38 and $2.46/MMBtu.
At the AECO hub in Alberta, prices began the week at about $(C) 2.58/Gigajoule before rising to $2.68/Gj by week's end [J. M.].
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