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AM Power Report: Dailies look to rising demand as heat spreads

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Six trends shaping the industries and sectors we cover in 2021

Six trends shaping the industries and sectors we cover in 2021

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Essential Energy Insights - January 2021


AM Power Report: Dailies look to rising demand as heat spreads

Followinga mixed session onTuesday, rising demand forecasts should help underpin across the U.S. onWednesday, July 20, despite lackluster action in the natural gas markets.

Atlast glance, August natural gas was trading just 3.0 cents lower at$2.698/MMBtu, giving back the 0.6cent added in the previous session but lacking any decisive movesfor more than a week.

Withnatural gas offering little guidance, power dailies should instead look todemand to drive prices as hotter weather across most of the country drives upcooling demand, especially in the Midwest and Northeast.

Inthe East, New England could see load top 18,500 MW on Wednesday and 20,080 MWon Thursday while load in New York is poised to hit 24,482 MW on Wednesday and26,654 MW on Thursday. In the mid-Atlantic, the PJM Western region should seedemand reach 70,242 MW on Wednesday and 75,931 MW on Thursday while the PJMMid-Atlantic region looks to load peaks of 45,457 MW on Wednesday and 48,362 MWon Thursday.

Inthe Midwest, demand in the PJM AEP region is expected to reach 20,232 MW onWednesday and 21,435 MW on Thursday while load in the ComEd region is poised toreach 18,877 on Wednesday and 21,220 MW on Thursday. The MidcontinentIndependent System Operator Inc. has declared a hot weather alert for theReliability Coordinator Footprint effective from July 20 at noon ET to July 22at 10 p.m. ET.

Elsewhere,the ERCOT grid operator sees load reaching 66,947 MW on Wednesday and 67,808 MWon Thursday. On the West Coast, demand in California is expected to reach39,746 MW on Wednesday and 40,847 MW on Thursday.

Lookingfurther out, term power products continue to drift aimlessly, reflectingindecisive action in natural gas futures.

Inthe East, deals for August delivery at the NEPOOL Mass hub were pegged near$39, off just 0.1% on the day, while PJM West saw front-month action on equalfooting to the Mass hub, but down 2.1% on the day.

Inthe Midwest, August deals across the region were spotted in the upper $30s withthe PJM AEP-Dayton hub sporting a modest premium to PJM Northern Illinois andMISO Indiana. However, daily changes were meager with the AD hub up 0.6%, theNI hub up 1.3% and Indiana up just 0.1%.

InTexas, ERCOT saw August deals at the North location fetching the highest pricesfor the entire country in the mid-$70s, up 0.8% on the day, but with thefourth-quarter product running a steep discount to August in the upper $20s,down 0.9% on the day.

Inthe West, Northwest markets saw the biggest daily gains with both Mid-Columbiaand COB up 3.6% each to prices near $30.50 and $32, respectively. InCalifornia, South Path-15 was spotted in the high $30s, about $2 above NorthPath-15, but with both markets down 0.1% on the day.

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Market prices and included industry data are current as ofthe time of publication and are subject to change. For more detailed marketdata, including power, natural gas and coal index prices, as well as forwards and futures, visit our Commodities Pages.