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AM Power Report: Dailies could stumble with load

The price of day-ahead power could unravel in some cases Thursday, Aug. 10, amid pressure from the anticipation of predominantly diminished demand at the close of the workweek.

Traders will also keep abreast of natural gas market activity. Gaining 6.1 cents in the prior session, NYMEX September natural gas futures were trending higher again ahead of the opening bell Thursday, tacking on 0.9 cent to trade at $2.892/MMBtu at 6:30 a.m. ET on light short covering ahead of the mid-morning release of the latest storage data from the U.S. Energy Information Administration.

Analysts and traders surveyed ahead of the release of the EIA's upcoming natural gas storage report anticipate an injection of 25 Bcf to 44 Bcf for the week ended Aug. 4, with an average 36-Bcf addition anticipated. The figure will compare to a 54-Bcf five-year-average injection and a 24-Bcf addition in the prior year.

Aside from regional weather-side support for values, spot natural gas markets are likely to advance in many cases Thursday, in tandem with any sustained gains in the futures arena.

On the demand side, outlooks suggest generally softer load at the close of the workweek, when business-related demand typically wanes approaching the weekend break.

In the Northeast, load in New England is called to reach 19,300 MW on Thursday and 17,720 MW on Friday, while New York demand should near 23,812 MW on Thursday and 22,315 MW at the end of the business week. In the Mid-Atlantic, load in the PJM Western region is seen cresting at 61,797 MW on Thursday and 59,714 MW on Friday, while demand in PJM Mid-Atlantic is projected to peak at 43,206 MW on Thursday and 39,516 MW on Friday.

In the Midwest, PJM AEP region load is forecast to reach highs at 18,171 MW on Thursday and 17,862 MW on Friday, while PJM ComEd demand could top out at 16,429 MW on Thursday and 14,813 MW on Friday.

In the South, Texas demand is expected to touch highs near 65,316 MW on Thursday and 66,601 MW at the close of the workweek, running against the broad decline.

In the West, demand in California is poised to reach 39,490 MW on Thursday and 40,640 MW on Friday, which could run counter to the usual pressure on power dailies in the region Thursday with the day's trading schedule typically altered to feature partly weekend products for Friday-Saturday delivery.

In term action, power prices for September were mixed but mostly higher Aug. 9, as steadily advancing front-month natural gas futures implied an ongoing uptick in fueling costs.

In the East, trades for September power added about 20 cents to average around $30 in New England but slumped 10 cents to an index atop $32 at PJM West. Power deals for October were assessed in the high $20s in New England and in the low $30s at PJM West.

In the Midwest, PJM AD September was up 45 cents day on day at an index above $32, while PJM Northern Illinois September was off around 40 cents against the broad uptick at an average above $31. MISO Indiana September power was flat at an index at about $34. Power for October delivery was quoted in the low to mid-$30s overall.

In the South, month-ahead power pricing deflated by around 20 cents to average almost $28 at ERCOT West but climbed by about 50 cents to $2 to indexes ranging from $29 to $33 at the rest of the ERCOT hubs. Regional price activity for October power spanned the low $20s to the low $30s.

In the West, roughly 60-cent gains steered prompt-month power to indexes close to $39 at both North Path-15 and South Path-15 in California, as an almost 60-cent uptick drove Mid-Columbia September to an average above $27 and a near 70-cent increase took Palo Verde September atop $29. Power parcels for October were marked in the high $30s in California and in the low to high $20s elsewhere in the region.

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