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Heat fails to inspire further gains for US power dailies


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Heat fails to inspire further gains for US power dailies

Outlooks for mostly subdued Tuesday demand and littlesupport from mixed spot natural gas prices drove next-day markets across thecountry lower Monday, July 25.

At the natural gas futures arena, the front-monthAugust contract reversed earlygains and closed the first session of the workweek at $2.747/MMBtu,down 3.0 cents. Likewise, spot gas markets moved in different directions.

According to the National Weather Service, "Avery hot and humid airmass will persist over much of the east over the nextcouple of days." In another forecast, notes that the northwesternU.S. may see a dangerous heat surge northward this week.

MostEast dailies retreat; NEPOOL-Mass firms

Power markets in most of the East, with the exceptionof NEPOOL-Mass, favored losses Monday owing to pressures from lower loadforecasts and mixed spot gas prices despite an ongoing heat wave.

Next-day deals at New York Zone G were done in thehigh $50s, down from a July 22 index of $66.25, while power at PJM West wasexchanged in the high $40s to low $50s, tumbling close to $10 on the session.Conversely, trades at NEPOOL-Mass defied the trend, gaining around $2 from July22 in the mid- to high $50s.

Despite soft demand, day-ahead markets ticked higherwith NEPOOL-Mass, New York Zone G and New York Zone J adding more than $10 toaverages of $59.65, $55.90 and $60.06, while DAMs at New York Zone A gainedabout $2 and averaged at $62.24.

Load in the Northeast and mid-Atlantic is set to fall,as Tuesday demand in New England could hit 24,110 MW, down 390 MW from Monday,while New York load may crest at 29,693 MW on Tuesday, off around 1,700 MW fromMonday. The PJM Mid-Atlantic region is expecting Tuesday demand to hit 55,824MW, dropping more about 1,500 MW from Monday, while load in the PJM Westernregion should crest at 73,108 MW on Tuesday, falling more than 2,300 MW fromthe day prior.

PJM issued a hot weather alert for the PJM RTO on July25 from 7 a.m. ET to 11 p.m. ET and another one for the mid-Atlantic andDominion regions on July 26 and 27 from 7 a.m. ET to 11 p.m. ET.

Midwestmarkets tumble with choppy load, easing gas

Mixed Tuesday load forecasts and cheaper spot gascombined to send power prices in the Midwest lower Monday. Most of thesession's action was centered at MISO Indiana, where power changed hands in thelow to mid-$40s, down from a July 22 index of $55.25.

PJM regions in the Midwest should see varied demand tokick off the workweek, with the PJM AEP region called to see a Tuesday high at21,349 MW, down more than 700 MW from Monday, while the PJM ComEd regionexpects load to top out at 19,171 MW on Tuesday, up about 600 MW from Monday.

Texasvalues ease with load, buoyed by gas

Forecasts of soft Tuesday demand pushed power packagesin Texas lower Monday with losses possibly mitigated by a modest uptick in spotgas prices.

The ERCOT grid operator is projecting demand to peakat 62,750 MW on Tuesday, falling more than 3,800 MW from Monday. Bogged down byload, next-day deals at ERCOT North lost less than a dollar in the low $30s.

Regional day-ahead markets also reflected sluggishdemand with most locations dropping $3 to $5 on the session to averages of$31.47 at ERCOT Houston, $29.53 at ERCOT North, $30.54 at ERCOT South and$29.56 at ERCOT West.

Incomingheat fails to support West dailies

Increased cooling demand due to an ongoing heatwaveand varied spot gas prices failed to provide dailies in the West with a boostMonday.

Posting the biggest losses for the session were powermarkets in the Northwest, where trades dipped by more than $30 and ranged inthe low to mid-$30s at Mid-Columbia and the high $30s to mid-$40s at COB. InCalifornia, power at North Path-15 changed hands in the low $40s, down from aJuly 22 index of $51.25, while South Path-15 dailies slipped by about $5 in themid-$40s. Hubs in the Southwest limited the downside to around $4 to $5 withpower changing hands in the mid-$40s to low $50s at Palo Verde and the low $50sat Mead.

The California ISO is calling for demand to run up to44,669 MW on Tuesday, rising by roughly 2,700 MW from Monday.

Market prices and included industry data are currentas of the time of publication and are subject to change. For more detailedmarket data, including power,natural gas andcoal index prices, as well asforwards andfutures, visit our Commodities Pages.