MISO issues alert; Northeast power prices spike on heat wave

The Midcontinent Independent System Operator issued a Max Generation Alert effective June 29 for the Central and North regions, due to forced generation outages. The ISO also extended Conservative Operations it first issued on June 28 to June 29. A Capacity Advisory was also placed in addition to the Max Gen Alert for June 29 until further notice.

In reaction to the alerts, the Indiana Hub real-time locational marginal prices climbed to around $104.50/MWh, and Michigan Hub LMP climbed higher to trade around $109.50/MWh as of 1:15 p.m ET.

On the Intercontinental Exchange, Indiana Hub intraday real-time 0800-2300 contract rose $5 from its previous settlement to trade at $73/MWh.

Overall month-to-date demand trended 5.5% higher this year compared to last year at the same time, from an average of 78.6 GW to 82.9 GW, according to grid operator data.

High temperatures for Indianapolis trended around 90 degrees Fahrenheit, according to the National Weather Service.

PJM prices follow

Power prices at West Hub real-time on-peak 0800-2300 contract spiked $14.50 to trade around $80.25/MWh on ICE.

AEP Dayton Hub intraday contract also trended up, rising about $8.25/MWh to trade at $85/MWh.

Temperatures in Philadelphia rose to 95 degrees F, and Cincinnati highs trended at 90 F, according to CustomWeather. The weather service also issued Excessive Heat Warnings for parts of New Jersey, and Southeast Pennsylvania.

Demand strongly responded to temperatures, with forecast demand for June 29 spiking to 118.2 GW, the highest levels of demand since last July, when PJM issued hot weather alerts for July 26-28 in reaction to another about of high temperatures.

Natural gas prices at Texas Eastern M3 for next-day flow also soared following temperatures, trading at $3.99/MMBtu.

Northeast prices, demand remain strong

Regional prices in the US Northeast remained elevated on June 29, as temperatures in region were forecast in the mid-90s degrees Fahrenheit though June 30, up nearly 10 degrees above seasonal average.

ISO New England real-time locational marginal prices trended in the $80s/MWh, while day-ahead LMPs traded well above $100s/MWh with system demand estimated around 23 GW, as of 1 pm ET.

On ICE, Mass Hub on-peak for June 30 delivery jumped more than $10 on the day to about $126.50/MWh, surpassing its mid-February level, and reaching the highest price since early January 2019.

The day-ahead peakload demand was forecast to remain strong day on day at 25.24 GW, nearly 45% above the month-to-date average and 54% above the June 2020 average, grid operator data showed.

In New Independent System Operator, Zone K Long Island real-time LMP traded just shy of $200/MWh and West Zone A traded above $150/MWh, as of 1 pm ET.

Meanwhile, NYISO Zone G and Zone J NYC on-peak for next-day delivery jumped double digits on the day to price at $80.25/MWh and $85.50/MWh, respectively, the strongest prices since mid-February.

NYISO expected peakload to decline about 3% on the day to 28.87 GW, but remain 33% above the month-to-date demand of 21.66 GW.

In natural gas, the cash price at Algonquin city-gates rose to $5.24/MMBtu, up 40 cents from its previous S&P Global Platts price of $4.84/MMBtu. In comparison, the hub traded around $2.74/MMBtu over the last week, according to Platts pricing data.

Heat advisories were forecast to remain in effect through June 30, according to the weather service. Further ahead, the temperatures were predicted to ease, providing relief to demand, power and gas prices.