Next-day power markets across the country were mixed but mostly muted Thursday, Dec. 7, following a clash between mixed to higher load forecasts and biased lower spot gas prices.
Losses dominated trading activity in front-month gas futures with the January 2018 contract closing the day down 15.9 cents to $2.763/MMBtu, fueled by the report of a 2-Bcf net injection into storage during the week ended Dec. 1 that defied expectations of a modest withdrawal. Likewise, spot gas market, with the exception of Transco Zone 6 New York, sagged and provided power markets with almost no support.
According to the National Weather Service, "Persistent and strong Santa Ana winds will bring extreme fire weather conditions to Southern California through at least Saturday," while Texas and the southern states may see a strong upper level system produce a wintry mix through Friday.
Following a small increase at Tennessee Valley Authority's Watts Bar 2 in Tennessee, total U.S. nuclear plant availability rose to 96.45% early Dec. 7.
Midwest dailies firm with demand forecasts
Strong load forecasts owing to winter weather countered slack spot gas prices and helped power markets in the Midwest stay on the positive side of the ledger Thursday.
Most of the session's action was concentrated at MISO Indiana, where power was quoted in the mid- to high $30s, up from a midweek index of $34.75.
Demand is projected to rise despite the approaching end of the workweek. The PJM AEP region is called to peak at 18,251 MW on Thursday and 19,047 MW on Friday, while the PJM ComEd region should near highs of 13,772 MW on Thursday and 13,916 MW on Friday.
East values slight varied amid mixed fundamentals
Mixed but predominantly muted moves were noted across eastern next-day markets on Thursday owing to conflicting signals provided by diverging demand forecasts and varied spot gas prices.
Along next-day markets, the New England Mass hub saw little change from Wednesday and priced power in the low $40s, while PJM West deals eased and were pegged in the mid- to high $30s.
On the other hand, day-ahead deals rose with the Mass hub trading power around a dollar higher to an average of $40.50, while gains of $5 were seen in New York DAMs with New York Zone A, New York Zone G and New York Zone J averaging $34.93, $39.10 and $39.58, respectively.
Grid operators in the region are expecting demand to diverge as the workweek comes to a close. New England load should top out at 16,900 MW on Thursday and 17,000 MW on Friday, while New York demand may crest at 21,500 MW on Thursday and 20,465 MW on Friday. The PJM Mid-Atlantic region might see load peak at 36,163 MW on Thursday and 37,800 MW on Friday, while the PJM Western region could note highs of 58,548 MW on Thursday and 58,326 MW on Friday.
Western power markets flounder in revised trade
Subdued weekend demand associated with next-day schedule revisions and a downtick in spot gas prices conspired to keep most western power markets lower on Thursday.
In the Southwest, Palo Verde packages shed roughly a dollar and spanned the high $20s. In California, power at South Path-15 eased by slightly less than a dollar in the low $50s. In the Northwest, heavy-load trades at Mid-Columbia also took a small step back and slipped by less than a dollar in the mid-$20s.
Demand in California is called to peak at 30,515 MW on Thursday and 29,601 MW on Friday.
The California ISO issued a Transmission Emergency Notice for the Southern California region effective from Dec. 7 at 12 a.m. PT to 11:59 p.m. PT owing to a local transmission emergency in the Ventura area.
Texas values ease with falling spot gas prices
Despite cold weather gripping the region, next-day deals in Texas floundered Thursday as incentives from robust demand forecasts were countered by falling spot gas prices.
The Electric Reliability Council of Texas is calling for highs of 52,325 MW on Thursday and 54,009 MW on Friday. However, next-day deals at ERCOT North saw little incentive to go higher and spanned the mid-$20s, down by less than a dollar from Wednesday.
In addition, trades at Into Southern were seen in the mid-$30s, up from a midweek index of $24.25.
On the other hand, day-ahead deals were firm with ERCOT Houston, ERCOT North and ERCOT West adding less than $1 from Wednesday and noting averages of $29.62, $26.70 and $27.12, respectively, while ERCOT South packages added almost $3 and averaged $30.54.
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.
