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Diverging fundamentals leave US power markets mixed

Next-day power markets around the U.S. spent the Thursday, June 1, session mixed as values were pulled in different directions by outlooks for varied Friday demand and falling spot natural gas prices.

Following reports of a bigger-than-expected 81-Bcf net injection during the week ended May 26, the front-month July natural gas contract tumbled to $3.008/MMBtu, down 6.3 cents. Spot gas markets also moved lower and failed to provide power values with support.

In other supply, total U.S. nuclear plant availability increased to 89.16% early June 1.

Midwestern power values firm despite mixed demand, sagging gas prices

Daily power prices in the Midwest notched gains Thursday despite varied load forecasts and decreasing spot gas prices.

MISO Indiana saw the bulk of the session's action with power exchanged in the mid-$30s for a day-on-day premium of around $3.

PJM regions should see mixed demand by the end of the workweek. Demand in the PJM AEP region may reach 16,208 MW on Thursday and 16,016 MW on Friday, while load in the PJM ComEd region should touch highs of 12,212 MW on Thursday and 13,277 MW on Friday.

Most western power dailies biased lower; Southwest values firm

Power prices in the West favored the downside Thursday, as support from elevated Friday load forecasts was countered by expectations of slack weekend demand associated with next-day schedule revisions and falling spot gas prices.

In the Northwest, dailies at Mid-Columbia and the California-Oregon Border hub slipped by $2 to $3 from midweek and spanned the low to mid-teens at the former and the low $20s at the latter. In California, North Path-15 deals were down by roughly a dollar in the low $30s, while South Path-15 trades eased slightly and changed hands in the high $20s to low $30s.

Defying the wider decline were markets in the Southwest. On-peak power at Palo Verde added around a dollar in the low to mid-$30s, while heavy-load trades at Mead were exchanged in the low to mid-$30s, little changed from the midweek.

The California ISO projects demand to peak at 29,504 MW on Thursday and 32,721 MW on Friday.

East power markets biased lower on slack fundamentals

Flat to lower moves were noted at power markets in the East on Thursday amid mostly subdued Friday load forecasts and easing spot gas prices.

Next-day deals at the New England Mass hub and PJM West market saw mixed but muted moves, with the former easing in the low to mid-$20s while the latter was flat to Thursday in the high $20s. New York Zone G next-day trades were down around a dollar in the mid-$20s.

On the flip side, day-ahead markets were mixed to higher. Gains of around $4 were noted at day-ahead markets at New York Zone G and New York Zone J, which averaged $30.70 and $33.67, respectively, while day-ahead deals at the Mass hub added almost a dollar and averaged $23.82. Deals at New York Zone A ran the other way with trades shedding around $2 and averaging $24.69.

Demand forecasts for the Northeast are pointed lower. New England load may run up to 15,000 MW on Thursday and 13,900 MW on Friday, while demand in New York should top out at 18,625 MW on Thursday and 18,502 MW by the end of the workweek.

Mixed load could be in store for the mid-Atlantic. The PJM Mid-Atlantic region is expected to see highs of 34,809 MW on Thursday and 31,904 MW on Friday, while the PJM Western region should see demand peak at 51,307 MW on Thursday and 51,976 MW on Friday.

Strong load forecasts fail to inspire Texas markets

Expectations of elevated Friday demand failed to boost day-ahead markets in Texas on Thursday with lower spot gas prices also putting pressure on values.

The Electric Reliability Council of Texas expects demand to crest at 51,748 MW on Thursday and 55,257 MW on Friday. However, day-ahead markets in the region moved lower as ERCOT Houston and ERCOT South slipped by $1 to $2 from midweek and averaged $31.99 and $29.89, respectively, while ERCOT North and ERCOT West eased slightly and averaged $25.72 and $26.40, respectively.

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, natural gas and coal index prices, as well as forwards and futures, visit our Commodities Pages.