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AM Power Report: Dailies could retreat with demand in week's opener

Day-aheadpower prices couldslump in the week's opening session Monday, July 25, amid forecasts for weakerdemand across the bulk of the country, though the downside could be limited by anygains at natural gas markets.

Climbing 8.5cents in the prior session, August natural gas futureswere extending higher early Monday ahead of the opening bell. At last look, thecontract was up 1.7 cents to $2.794/MMBtu on light short-covering ahead of thecontract's expiration at the close of business July 27.

Intandem with the ongoing gains for futures Monday, next-day gas prices could seehigher moves to kick off the new week.

Lookingat demand, most grid operators across the country anticipate softer load as theweek unfolds.

Inthe Northeast, load in New England is expected to touch a high near 24,500 MWon Monday and 24,110 MW on Tuesday, while demand in New York is forecast topeak at 31,401 MW at the start of the business week and 29,693 MW on Tuesday.Farther south, PJM Western region load could crest at 74,506 MW on Monday and73,032 MW on Tuesday, while PJM Mid-Atlantic demand could top out at 56,910 MWon Monday and 54,599 MW on Tuesday.

Inthe Midwest, load in the PJM AEP region is projected to hit a high at 21,895 MWon Monday and 21,349 MW on Tuesday, while demand in PJM ComEd is forecast todefy the wider decline and reach 18,618 MW on Monday and 19,207 MW on Tuesday.

In the South, ERCOT demand should near 66,243 MW at thestart of the workweek and 62,574 MW on Tuesday. In the West,load in CAISO is poised to see highs at 42,000 MW on Monday and 44,515 MW onTuesday.

Interm trading, power prices for August were mostly biased to the upside ahead ofthe weekend, in tandem with front-month natural gas futures that notched gainson the session to ultimately signal an uptick in fueling costs.

Inthe East, transactions for August power delivery advanced by almost 40 cents tothe high $30s at NEPOOL-Mass but retreated by a little more than 50 centsagainst the broad uptrend to average in the low $40s at PJM West, as powerdeals for delivery in September ran through the low $30s in New England and themid-$30s at PJM West.

Inthe Midwest, MISO Indiana August added roughly 90 cents in trades done in thehigh $30s, as prompt-month power parcels at PJM AD and PJM Northern Illinoisdefied the dominant uptrend by shedding near 30 cents and giving back about $2,respectively, in deals carried out also in the high $30s at both hubs. Lookingahead, power for September delivery was quoted in the low $30s across the threehubs.

Inthe South, the ERCOT markets saw price activity for front-month power tack onover $5 across the board to average in the low $60s overall, as regionalpricing for September power spanned the low $30s.

Inthe West, power values for August climbed by near 90 cents to the high $30s atboth North Path-15 and South Path-15 in California, as month-ahead power pricesascended by about $2 to the low $30s at Mid-Columbia and rose by almost 80cents to an index also in the high $30s at Palo Verde. Price action forSeptember power was likewise spread in the high $30s in California and in thehigh $20s to the low $30s elsewhere in the region.

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Market prices and included industry data are currentas of the time of publication and are subject to change. For more detailedmarket data, including power and natural gas indexprices, as well as forwards and futures, visitour Commodities Pages.