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AM Power Report: Dailies could be lifted by load outlooks, gas

Price activity for next-day power could favor the upside Tuesday, Aug. 8, as generally stronger demand anticipated at midweek combines with subdued ongoing gains at the natural gas futures complex.

Ending 2.7 cents higher in the prior trading day, NYMEX September natural gas futures were extending the upside early Tuesday ahead of the opening bell. At 6:30 a.m. ET, the front-month contract was up 0.8 cent to $2.809/MMBtu on light short covering amid recent oversold conditions.

Next-day natural gas prices could edge up in trade Tuesday, in line with the recent uptick in the futures arena. Weather-related demand in some regions could provide an additional impetus for spot gas values to move higher at some markets Tuesday.

On the demand side, most grid operators across the country see elevated load at midweek.

In the Northeast, demand in New England is poised to peak at 16,800 MW on Tuesday and 18,680 MW on Wednesday, while load in New York is called to reach 21,501 MW on Tuesday and 22,368 MW in the middle of the business week. In the Mid-Atlantic, the PJM grid operator sees demand in the PJM Western region cresting at 56,015 MW on Tuesday and 59,528 MW on Wednesday, while load in PJM Mid-Atlantic is projected to hit highs at 38,064 MW on Tuesday and 40,233 MW on Wednesday.

In the Midwest, PJM AEP region load will likely reach highs at 16,988 MW on Tuesday and 17,653 MW on Wednesday, while PJM ComEd demand could top out at 14,201 MW on Tuesday and 15,358 MW on Wednesday.

In the South, load in Texas should peak near 58,093 MW on Tuesday and 62,312 MW at midweek. In the West, California demand is forecast to see highs at 40,775 MW on Tuesday and 40,600 MW on Wednesday.

Along the forward curve, power prices for September moved in diverging directions in the week's opening session Aug. 7 amid varied weather-driven demand expectations.

In the East, transactions for prompt-month power delivery were lifted by more than $1 to an index above $29 in New England and bolstered by 10 cents to an average atop $32 at PJM West. Power deals for October were similarly assessed in the high $20s in New England and in the low $30s at PJM West.

In the Midwest, PJM AD September rose by about 30 cents to near $33, and PJM Northern Illinois September advanced by roughly 10 cents to an average close to $32, as MISO Indiana September slumped by around 10 cents to an index at $34. Along the forward curve, power for October delivery was marked in the low to mid-$30s.

In the South, losses on either side of 20 cents at the ERCOT markets steered price activity for September power to indexes ranging from $28 to $33. Regional pricing for October power spanned the low $20s to the low $30s.

In the West, California saw front-month power trades fall nearly 60 cents at North Path-15 and 40 cents at South Path-15 to indexes around $38, as similar deals shed almost 20 cents to average atop $27 at Mid-Columbia and added roughly $1 to average close to $29 at Palo Verde. Power transactions for October were done in the mid- to high $30s in California and in the low to high $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.