Frigid weather elevates US Northeast power and gas prices

Prolonged cold temperatures across the US Northeast have driven regional power and gas prices higher, with markets surging ahead of New Year's Day.

ISO New England Mass Hub day-ahead on-peak prices gained double digits from the prior price on the Intercontinental Exchange, trading around $170/MWh and reaching the highest level since mid-December. In off-peak markets, prices soared, trading above $150/MWh.

In the New York Independent System Operator, Zone J NYC and Zone G Hudson Valley on-peak locational marginal prices averaged about $20 higher, trading around $127.75/MWh and $129.50/MWh, respectively, while off-peak prices were up about $15, settling slightly below $100/MWh.

Similarly, in natural gas markets, the spot price at the Algonquin city-gates jumped over $2 from its previous Platts assessment to reach $18.76/MMBtu, also the highest in about two weeks. Transco Zone 6 NY increased about $1.63 to $6.75/MMBtu for Jan. 1-5 flows.

Tracking cooler weather this year, Algonquin city-gates gas prices averaged $14.96/MMBtu in December, and Transco Zone 6 NY averaged $6.97/MMBtu, up 64% and 83%, respectively, according to Platts data.

High temperatures in Boston and New York City were forecast to be in the upper 20s F and lower 30s F on Jan. 1, with winter weather advisories in effect for some coastal and interior areas through early Jan. 1, the US National Weather Service reported.

ISO-NE peakload demand averaged 4.4% higher in December at 17.50 GW, and NYISO load was 3.5% higher at 20.51 GW, according to ISO data.

Renewables

With freezing temperatures driving up power and natural gas prices in the Northeast, there was also a sharp surge in renewable capture prices across the region.

On Dec. 29, ISO-NE solar capture prices closed at $135.18/MWh, representing a 265% increase from the previous month and a 212% rise compared to the same period last year. Wind capture prices also climbed, closing at 123.83%—a 126% jump from Nov. 29 and a 189% increase year over year.

The NYISO wind prices saw mostly stable month-over-month changes, while year-over-year changes increased, bolstered by recent cold snaps impacting the region. The Hudson Valley wind zone recorded year-over-year increases of around 83%, while its West zone counterpart observed gains just under 57%.

Platts is part of S&P Global Energy.