Palo Verde on-peak day-ahead power hits record $1,643.25/MWh, conservation urged

Houston — NV Energy and the Public Utilities Commission of Nevada are urging consumers to conserve energy as wholesale power prices in the state hit back-to-back record highs on the back of a multi-day stretch of triple-digit temperatures across the region.

NV Energy issued a statewide alert for customers to conserve electricity between 2 pm PT (2100 GMT) and 9 pm PT Aug. 18-19, which the PUC urged consumers to follow during the next several days.

Record-high temperatures continue to be forecast across the Desert Southwest and the region is under an excessive heat warning, heat advisory and fire weather watch, according to the US National Weather Service.

NEVADA POWER PRICES HIT RECORD HIGH IN HEAT WAVE

Palo Verde on-peak day-ahead set a record high price of $1,643.25/MWh for Aug. 19 delivery, surpassing a record high of $1,310.56/MWh set just a day earlier, according to S&P Global Platts data.

High temperatures are forecast to reach 113 degrees Fahrenheit in Phoenix Aug. 19, 111 F on Aug. 20, 108 degrees on Aug. 21 and 107 F on Aug. 22, according to the weather service. Phoenix highs have been above 114 degrees for the last week and have averaged 6.4 F above normal so far this month, reaching as high as 117 F on Aug. 14.

However, power prices further along the yield curve were starting to trend down for the first time in more than a week as temperatures are forecast to ease some in the coming days.

Palo Verde on-peak day-ahead for Aug. 20 delivery traded between $175/MWh and $210/MWh in morning trading on the Intercontinental Exchange, while the super-peak strip for hours ending 1-8 pm PT was trading around $425/MWh. On-peak balance-of-the-month was bid at $175/MWh and offered at $250/MWh on ICE, below the previous settlement of $475.10/MWh.

In comparison, Palo Verde on-peak has averaged in the upper $250s/MWh so far this month, 539% higher than in the year-ago period, according to Platts data.

Power forwards were also easing, with Palo Verde on-peak September bid at $65/MWh and offered at $77/MWh on ICE, below the previous settlement of $85/MWh. The on-peak September package has averaged in the mid-$40s/MWh so far this month, an increase of 34% month on month and a jump of 50% from where the 2019 package averaged a year ago, according to Platts data.