Major heat wave drives up power demand, prices across US MidAtlantic, Northeast

The first significant heat wave of the season is moving across the US MidAtlantic and Northeast June 23, driving up power demand and power prices, with grid operators and government officials issuing hot weather alerts and calls for demand response resources to help manage soaring power demand.

PJM Interconnection issued a Maximum Generation Emergency/Load Management Alert, Pre-Emergency Load Management Reduction Actions, and a Hot Weather Alert June 23, as well as similar emergency preparedness procedures during the weekend of June 21.

The high temperature in Chicago is forecast to reach 96 degrees Fahrenheit June 23 and there is an Extreme Heat Warning in effect until midnight Eastern Daylight Time June 24, according to the National Oceanic and Atmospheric Administration.

Philadelphia is forecast to reach a high temperature of 100 F June 23 and could reach 101 F June 24, according to NOAA, which has issued an Extreme Heat Warning until 8 pm EDT June 25.

Power demand in PJM is expected to reach 160,476 MW June 23 and 161,114 MW June 24 before decreasing slightly, according to PJM's load forecast.

In its preliminary summer analysis, the ISO expected power demand to reach 161 GW under its 50/50 load forecast and 166.6 GW under the 90/10 forecast, which is the more conservative of the two. The 90/10 forecast means there is a 10% chance that peak demand will surpass the forecast.

US Northeastern peak power prices showed increases in June 23 trading, pricing in triple digits amid the ongoing excessive heat.

In PJM, June 23 the West Hub day-ahead price was trading near $230/MWh on the Intercontinental Exchange, adding about $12 on the day.

The highest real-time power prices around midday June 23 were in the Dominion Zone where they reached $268.89/MWh, according to PJM data.

New York, New England

In New York, Governor Kathy Hochul declared a State of Emergency in 32 counties in response to severe weather and the extreme heat June 22.

Temperatures reached 94 F in New York City by midafternoon June 23, with a high of 94 F forecast for June 24, according to NOAA, which has issued an Extreme Weather Warning, a Hazardous Weather Outlook, and an Air Quality Alert.

The New York Independent System Operator said power supply conditions were "normal" as of midafternoon June 23, though the grid operator said that "Special Case Resources" and "Emergency Demand Response Program" resources would be needed June 23-24.

Power demand was forecast to peak at 30,398 MW June 24, after reaching 29,397 MW June 23, according to the NYISO load forecast.

The grid operator forecast a peak power demand this summer of 31,471 MW. Summer 2024 peak power demand in New York State reached 28,990 MW, and the record-high peak power demand of 33,956 MW was reached in July 2013 at the end of a week-long heat wave

Real-time power prices were above $200/MWh by midafternoon June 23 in every Zone except North Zone D, according to NYISO data. The highest real-time prices were in New York City Zone J at $267.22/MWh.

The on-peak locational marginal prices for Zone J NYC and Zone G Hudson Valley each jumped over $50 June 23 from the day before, settling around $181.75/MWh and $173.75/MWh, respectively. Additionally, the corresponding off-peak prices averaged about $1.25 higher on the day, reaching around $59.25 at Zone J and $58.50/MWh at Zone G.

Temperatures in Boston were in the mid-80s F June 23 but were forecast to reach 102 F June 24, according to NOAA, which has an Extreme Heat Warning in effect until 8 pm EDT June 24.

Power demand is forecast to peak at 23,920 MW June 23 and 25,310 June 24, according to the ISO New England load forecast.

ISO-NE forecasts summer 2025 power demand to reach 24,803 MW under normal weather conditions, and up to 25,886 MW during periods of above-average temperatures, with approximately 29,000 MW of available capacity.

ISO New England's Mass Hub on-peak price for June 24 delivery traded around $189/MWh, up about $36 from its previous settlement on ICE, while the off-peak price traded around $54.25/MWh, reflecting an increase of about $6.50.

Looking further into the week, prices could retreat slightly while remaining elevated, as the Mass Hub on-peak balance-of-the-week for June 25-27 delivery was valued near $75/MWh, down from its prior price of about $110/MWh, and PJM traded around $105/MWh, down over $40.