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AM Power Report: Dailies could be mixed amid varied fundamentals

Price activity for next-day power could be jumbled Tuesday, April 4, as diverging demand projections for midweek combine with the recent volatility at the natural gas futures complex.

Tracking more than 6 cents lower in the prior session, NYMEX May natural gas futures were little changed to slightly higher in early trade Tuesday. At 6:30 a.m. ET, the front-month contract was pegged just 0.7 cent higher at $3.135/MMBtu on very light short covering.

Following the lead of the futures market, next-day natural gas prices at the major consuming hubs are likely to see a mixed session of trade Tuesday.

Looking at demand, outlooks suggest varied but predominantly softer load at midweek.

In the Northeast, demand in New England could reach highs at 15,500 MW on Tuesday and 15,000 MW on Wednesday, while New York load could touch a high near 17,870 MW on Tuesday and 17,758 MW at midweek. To the south, demand in the PJM Western region could defy the wider decline as it is called to reach 47,089 MW on Tuesday and 47,357 MW on Wednesday, while PJM Mid-Atlantic load is poised to hit highs at 30,659 MW on Tuesday and 30,452 MW on Wednesday.

In the Midwest, demand in the PJM AEP region could hold near unchanged at peaks at 14,568 MW on Tuesday and 14,564 MW on Wednesday, while PJM ComEd load could also run against the broad downtrend as it is expected to see highs at 11,295 MW on Tuesday and 11,635 MW at midweek.

In Texas, load in ERCOT is projected to crest at 45,981 MW on Tuesday and 38,629 MW in the middle of the business week. In California, CAISO demand is poised to top out at 28,050 MW on Tuesday and 28,850 MW on Wednesday.

In term action, power for May delivery had a weak showing in much of the country in its first day as the front-month offering April 3, in tandem with May natural gas futures that notched losses on the session, signaling a reduction in fueling costs.

In the East, price activity for May power shed almost 70 cents to average around $34 at NEPOOL-Mass and deflated by roughly 80 cents to an index near $36 at PJM West. Along the forward curve, power values for June were spotted in the low to mid-$30s in New England and in the high $30s at PJM West.

In the Midwest, the fresh prompt-month power parcels gave back about $1 in trades done near $35 at PJM AD, while similar packages unraveled almost $2 in deals carried out on either side of $33 at PJM Northern Illinois and MISO Indiana. Power for June delivery across the three hubs was transacted in the low to high $30s.

In the South, losses of 50 cents to as much as 80 cents at the ERCOT markets steered pricing for May power to indexes ranging roughly from $25 to $32. Regional price action for June power spanned the low to high $30s.

In the West, California saw front-month power prices falter by about 50 cents to average above $24 at North Path-15 but advance by almost 40 cents against the wider decline to an index of $24 at South Path-15. Mid-Columbia May power was flat at an average near $12 and Palo Verde May was up roughly 50 cents to $25. Pricing for June power was pegged in the low to mid-teens at Mid-C and in the high $20s to the low $30s 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.