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Higher gas prices lift power dailies at midweek; Mid-Columbia values sag


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Higher gas prices lift power dailies at midweek; Mid-Columbia values sag

An increase in spot gas prices countered pressures from varied Thursday load forecasts and helped keep most next-day power markets around the U.S. pointed higher Wednesday, Dec. 6.

Following two sessions of losses, the front-month January 2018 contract managed to notch a scant 0.8 cent gain to settle at $2.922/MMBtu. Excluding deals done at SoCal Border, spot gas markets ticked higher and provided power values with support.

According to the National Weather Service, "heavy lake effect snows have developed near the Great Lakes, with the heaviest accumulations expected near Lakes Erie and Ontario over the next few days."

Despite the loss of Entergy Corp.'s Grand Gulf 1 in Mississippi, total U.S. nuclear plant availability rose to 96.14% early Dec. 6.

Strong demand outlooks, higher gas prices support Eastern power markets

Robust demand forecasts and a rise in regional spot gas prices boosted power markets along the East Coast on Wednesday.

Along next-day markets, gains of more than $5 were noted at the New England Mass hub and PJM West where power changed hands in the high $30s to low $40s at the former and the mid- to high $30s at the latter.

Grid operators in the Northeast are projecting elevated demand. New England load could touch 16,800 MW on Wednesday and 16,900 MW on Thursday, while New York demand should reach 20,282 MW on Wednesday and 20,496 MW on Thursday.

On the other hand, demand outlooks in the mid-Atlantic are mixed. The PJM Mid-Atlantic region might see load crest at 37,213 MW on Wednesday and 36,824 MW on Thursday, while the PJM Western region may top out at 56,748 MW on Wednesday and 59,419 MW on Thursday.

Midwest values firm despite mixed demand forecasts

Daily power prices in the Midwest were firm with gas support Wednesday but with varied load forecasts keeping the uptick in check.

MISO Indiana saw the bulk of Wednesday's action with power exchanged in the mid-$30s, up by roughly $3 on the session.

Mixed load could be in store for the region toward the latter part of the workweek. The PJM AEP region may note highs of 18,232 MW on Wednesday and 17,995 MW on Thursday, while the PJM ComEd region should hit peaks of 13,426 MW on Wednesday and 14,139 MW on Thursday.

Most West markets tick higher despite slack load forecasts; Mid-Columbia flounders

Power packages for Thursday delivery leaned mixed to predominantly higher Wednesday as most locations withstood pressures from slack demand forecasts and found support in biased higher gas prices.

The California ISO is projecting highs of 30,829 MW on Wednesday and 30,645 MW on Thursday. However, North Path-15 and South Path-15 priced power $1 to $4 higher in the low $40s and low to mid-$50s, respectively. In the Southwest, power packages noted daily premiums of $2 to $3 and were quoted in the high $20s to low $30s at Palo Verde and the low $30s at Mead.

In the Northwest, power values were slightly mixed, with Mid-Columbia deals shedding roughly $2 in the mid-$20s, while the California-Oregon Border priced power in the high $20s to mid-$30s, up less than a dollar from Tuesday.

Texas values supported by demand forecasts, gas gains

Daily power markets in Texas spent a quiet midweek session supported by higher spot gas prices and elevated demand forecasts.

The Electric Reliability Council of Texas is calling for demand to peak at 48,310 MW on Wednesday and 52,396 MW on Thursday.

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.