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AM Power Report: Dailies could ease with load, gas ahead of Thanksgiving holiday

Price action for power dailies could be biased lower Wednesday, Nov. 22, as generally softer demand expectations through and coming off the Thanksgiving holiday combine with the recent weakness in natural gas futures trading.

At last glance at 7:30 a.m. ET, NYMEX December natural gas futures were trading 2.4 cents lower on the day at $2.993/MMBtu

On the demand side, most grid operators across the country see declining load through and coming off the Thanksgiving holiday, with business-related demand expected to remain subdued during the holiday and approaching the weekend break.

In the Northeast, load in New England is seen cresting at 16,250 MW on Wednesday and 14,180 MW on Thursday before recovering to 14,810 MW on Nov. 24, while New York demand is expected to peak at 19,870 MW on Wednesday and 16,523 MW on Thursday before retracing higher to 18,209 MW on Nov. 24.

In the Mid-Atlantic, load in the PJM Western region is called to reach 55,080 MW on Wednesday, 48,688 MW on Thursday and 47,938 MW on Nov. 24, while demand in PJM Mid-Atlantic should near 35,205 MW on Wednesday and 31,433 MW on Thursday ahead of a slight recovery to 31,767 MW on Nov. 24.

In the Midwest, PJM AEP region load could see highs at 16,991 MW on Wednesday, 15,918 MW on Thursday and 14,946 MW on Nov. 24, while PJM ComEd demand could reach highs at 12,904 MW on Wednesday, 11,053 MW on Thursday and 10,972 MW on Nov. 24.

In the South, demand in Texas is forecast to top out at 42,040 MW on Wednesday and 37,828 MW on Thursday before easing further to 36,250 MW on Nov. 24.

In the West, California load is poised to touch a high near 31,682 MW on Wednesday and 27,606 MW on Thursday.

At the term markets, pricing for December power was mixed with a dominant downside bias Tuesday, as losses at the natural gas futures arena implied cheaper fueling costs.

In the East, front-month power deals were almost unchanged day on day at an index at approximately $51 in New England but about 90 cents weaker at an average near $35 at PJM West. Further along the forward curve, power trades for January 2018 were assessed in the high $70s in New England and in the mid-$40s at PJM West.

In the Midwest, December power values advanced by 10 cents against the broad decline to average around $34 at PJM AD, but slumped by about 30 cents to an index atop $31 at PJM Northern Illinois and faltered by nearly 20 cents to an index at roughly $33 at MISO Indiana. Looking ahead, power prices for January 2018 spanned the high $30s to the low $40s overall.

In the South, losses of 55 cents to about 80 cents at the ERCOT markets steered pricing for month-ahead power to indexes ranging roughly from $21 to $29. Regional price activity for January 2018 power ran through the mid-$20s to the low $30s.

In the West, California saw power trades for December shed almost 30 cents to average at near $43 at North Path-15 but climb by around $2 against the wider retreat to an index at close to $46 at South Path-15, while December power was quoted between $32 and $33 in transactions off 50 cents on the day at Mid-Columbia but up by roughly 20 cents against the broad downtrend at Palo Verde. Further out, January 2018 power was marked in the low $40s in California 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.