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Western Price Survey / Archives

December 21, 2001
Traders Wrap Up the Week Early

As power traders wrapped up their dealings for the rest of the week on Wednesday, Western power prices fell into the low- to mid-20s across the region. Midweek trading covered Thursday through Saturday deliveries. Any transactions done during the rest of the week were for meeting late-minute loads--or more likely to get rid of excess supplies at bargain prices.

Peak power prices began the week centered at 30 mills, a little higher in Northern California and at Palo Verde, but lower in the Pacific Northwest.

The trend was clearly lower across the board, with Mid-Columbia slipping to the 22.5 mills to 23 mills/KWh range for peak and 19 mills/KWh for off- peak. The California/Oregon Border fell from 30 mills to 25.5 mills/KWh. Both NP15 and SP15 were 26 mills to 28.5 mills/KWh for daytime energy and 20 mils to 23 mills for off-peak. Prescheduled Palo Verde ranged between 26 mills and 27.5 mills/KWh, with off-peak energy at 16.5 mills/KWh.

By Thursday everyone had pretty much closed their books. No transactions were reported by the Intercontinental Exchange for Western hubs, and Bloomberg reported thin real-time sales at 21.4 mills for COB and 23.25 mills/KWh for Palo Verde.

Though temperatures were slightly colder in Southern California and harsh rains pelted northern areas, the expectations were well within seasonal parameters. "It looks like it's going to be mild across the West," noted one trader.

Continued rains in the Pacific Northwest have lent confidence to federal power sellers, and the Bonneville Power Administration extended its offer of 100 MW at market prices through the upcoming weekend.

There were some constraints imposed on southbound flows on the California/Oregon Intertie and higher limits northbound on Path 15 that brought congestion pricing into play. Still, the California Independent System Operator noted 5,000 MW to 6,000 MW of imports coming into the state, reducing any concerns that the 11,000 MW of in-state generation outages would cause a squeeze.

Still on Cal-ISO's list of unplanned outages was Mohave No. 1 (440 MW). Calpine's Los Medanos unit was down by nearly 60 percent, and Ormond Beach No. 2 was operating at slightly under half its 750 MW capacity. El Segundo No. 3 dropped 337 MW. There were lesser deratings reported at San Onofre No. 3 and Four Corners No. 5, which will take a repair hiatus starting in mid-January to work on generator problems that are limiting output.

Even as the Cal-ISO peak reached toward 33,500 MW on Thursday, there was plenty of excess capacity in the system left after meeting the load.

The Alberta Power Pool peaked to 519 mills/KWh Thursday, but it was a ghost from the past and soon faded to 70 mills/KWh.

Barring an unexpected cold front, transmission outage or serious imbalance in the supply/demand ratio, traders anticipate little change in pricing through New Year's [Arthur O'Donnell].

Gas Prices Nickeled and Dimed Lower

Trading activity trailed off quickly as natural gas sellers failed to find much of a market once power generators booked their supplies for the rest of the month. Prices at Western hubs took a steady slide downward this week, dropping a nickel or a dime each day.

On the national scene, forward contracts and the daily markets were stunned by the exceedingly low storage withdrawal report from the American Gas Association. The AGA said just 45 Bcf left storage last week--about a quarter of the figure for the same week last year and reportedly the lowest mid-December takeout ever. With more than 3 Tcf still in the wells and fairly moderate weather seen across the US, January and February prices slipped.

In the Western dailies, basin prices in Texas and new Mexico dropped to less than $2.40/MMBtu and the Southern California Border price eroded to $2.54/MMBtu by Thursday.

The San Francisco CityGate was down to $2.77 after starting the week above $3/MMBtu, and Malin fell to $2.55/MMBtu.

The Alberta price weakened to $(C)3.30/Gigajoule from its high of $3.59/Gj [A. O'D.].

Western Electricity Prices
Week of December 17-21, 2001
Hub Peak (heavy) Off-peak (light)
Alberta Pool (C$) 44-519 13-40
Mid-Columbia 22.5-30 19-25
COB 25.5-31 23-26
NP 15 26-33.75 20-28.5
SP 15 26-32 20-27
Palo Verde 25-32 16.5-26

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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