Forecasts for robust Thursday demand due to summerheat kept power values across the country moving higher Wednesday, July 20, butwith gains at most locations limited by softer spot natural gas prices.
At the natural gas futures complex, the front-month Augustcontract extended prior losses and closed the midweek session down 7.0 cents at$2.658/MMBtu. Likewise, spot gas markets excluding those in the East favoredlosses.
According to a July 20 forecast from AccuWeather.com,parts of the northeastern U.S. may see some of the "hottest weather of thesummer" through later this week and into the weekend.
Scorchingheat drives Midwest markets higher
Increased cooling demand driven by sweltering summerheat offset soft spot gas prices and pushed power markets in the Midwest higherWednesday.
Power deals at PJM AEP-Dayton were done in the mid- tohigh $40s, up from a Tuesday index of $36.00, while PJM Northern Illinois andMISO Indiana saw power exchanged in the high $40s, rising from prior-dayindexes of $42.25 and $37.75, respectively.
Load forecasts in the Midwest are aimed higher withthe PJM AEP region expecting Thursday demand to touch 21,509 MW, up more than600 MW from Wednesday, while the PJM ComEd region should see Thursday load hit21,456 MW, gaining around 1,600 MW from midweek.
PJM announced a Hot Weather Alert for the ComEd regionfor July 21 from 7 a.m. to 11 p.m. ET.
Strongdemand drives West market gains; Southwest values rebound
Load outlooks suggesting strong Thursday demand droveup power markets in the West on Wednesday with the uptick limited by easingspot gas prices.
Dailies in the Southwest added more than $10 on thesession and ranged in the low to mid-$50s at both Palo Verde and Mead. Gains of$2 to $4 were recorded in the Northwest with Mid-Columbia power traded in thehigh $20s to mid-$30s and dailies at COB transacted in the high $30s. InCalifornia, deals at North Path-15 were heard in the mid- to high $30s for adaily premium of about $2 while South Path-15 saw power trade around $6 higherin the low to mid-$40s.
The CAISO is predicting Thursday demand to peak at41,420 MW, up around 1,700 MW from Wednesday.
Eastdailies supported midweek
Power packages in the East were priced at a premiumWednesday on expectations of elevated Thursday demand and flat to higher spotgas prices.
In the Northeast, next-day deals at NEPOOL-Mass andNew York Zone G added $3 to $5 from Tuesday and were done in the mid-$30s whilein the Mid-Atlantic, power at PJM West was traded in the low to mid-$40s, up froma Tuesday index of $35.44.
Day-ahead markets in the Northeast also ticked higher,with gains of more than $5 seen at NEPOOL-Mass, New York Zone G and New YorkZone J, which averaged $35.29, $37.45 and $39.45, respectively, while DAMs atNew York Zone A soared by more than $35 to an average of $72.01.
Grid operators in the Northeast and Mid-Atlanticexpect increased demand. Thursday load in New England is called to reach 20,080MW, up 1,580 MW from Wednesday, while demand in New York could hit a Thursday peakat 26,654 MW, adding more than 2,100 MW from midweek.
The PJM Mid-Atlantic region expects load to crest at48,547 MW on Thursday, gaining 3,880 MW from Wednesday, while demand in the PJMWestern region should top out at 76,375 MW on Thursday, amassing more than4,500 MW from the day prior.
PJM announced a Hot Weather Alert for the PJM RTO onJuly 22-24 from 7 a.m. to 11 p.m. ET and another one for the Dominion andMid-Atlantic regions for July 25 from 7 a.m. to 11 p.m. ET.
Texasdailies gain ground with demand, held back by cheap gas
Expectations of strong Thursday demand kept priceactivity in Texas biased higher Wednesday with gains at most hubs contained byeasing spot gas values.
The ERCOT grid operator is calling for Thursday loadto run up to 68,277 MW, up more than 1,200 MW from Wednesday. Encouraged by thedemand outlook, next-day deals at ERCOT North added around $4 and were heard inthe high $30s to low $40s.
Regional day-ahead markets also edged higher withload, with ERCOT Houston, ERCOT North and ERCOT West adding $4 to $5 fromTuesday to average $40.74, $38.52 and $37.94, respectively, while ERCOT Southdeals jumped by more than $10 and averaged $40.14.
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