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AM Power Report: Dailies could unravel with demand, gas in week’s opener


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AM Power Report: Dailies could unravel with demand, gas in week’s opener

Power dailies could be tethered to the downside in the week’s opening session Monday, Jan. 23, amid the combined pressure of expectations for predominantly declining demand for Tuesday and ongoing weakness at the natural gas futures arena.

Slumping more than 16 cents in the prior session, February natural gas futures were recovering some ground early Monday ahead of the opening bell. At last look, the contract was up 2.8 cents to $3.232/MMBtu on light short covering.

In tandem with the sharp losses in futures ahead of the weekend, many day-ahead natural gas markets could see losses in the week's opening session.

On the demand side, outlooks suggest varied but predominantly weaker load as the fresh workweek unfolds.

In the Northeast, demand in New England is projected to peak at 17,800 MW on Monday and 17,380 MW on Tuesday, while load in New York is expected to hit highs at 20,415 MW at the start of the fresh workweek and 20,285 MW on Tuesday. In the Mid-Atlantic, PJM Western region demand is poised to defy the broad decline as it is seen cresting at 53,210 MW on Monday and 53,586 MW on Tuesday, while PJM Mid-Atlantic load is forecast to top out at 37,086 MW on Monday and 36,550 MW on Tuesday.

In the Midwest, demand in the PJM AEP region is called to reach 15,991 MW on Monday and 15,970 MW on Tuesday, while load in PJM ComEd is also set to run against the dominant downdraft as it is forecast to see highs at 12,761 MW on Monday and 12,919 MW on Tuesday.

In the South, the ERCOT operator expects demand to touch a high near 40,009 MW on Monday and 39,961 MW on Tuesday. In the West, demand in CAISO should near 31,361 MW at the return of the workweek and 30,471 MW on Tuesday.

In forward action, the price of power for February delivery was weaker across the board ahead of the weekend, in tandem with front-month natural gas futures that notched substantial losses on the session ultimately implying a reduction in fueling costs.

In the East, losses of between $1 and $2 steered trading activity for February power to indexes above $60 at NEPOOL-Mass and at almost $42 at PJM West. Further out on the forward curve, power deals for March were carried out in the high $40s in New England and in the high $30s at PJM West.

In the Midwest, the prompt-month power offering also shed between $1 and $2 at the PJM markets in transactions done near $39 at the AD hub and atop $36 at the Northern Illinois hub, while similar packages at MISO Indiana gave back about $3 in trades averaging above $39. Power for March across the three hubs was quoted in the low to high $30s.

In the South, power values for front-month delivery at the ERCOT markets similarly recoiled by between $1 and $2 to indexes ranging from $27 to atop $31, while regional pricing for March power likewise ran through the high $20s to the low $30s.

In the West, California saw power deals for February unravel roughly $1 to average near $35 at North Path-15 and deflate by around 80 cents to an index at $33 at South Path-15, while similar transactions shed 50 cents to average at about $27 at Mid-Columbia and faltered by more than $1 to an index close to $26 at Palo Verde. Trades for March power were spread in the high $20s to the low $30s in California and in the low $20s 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.