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AM Power Report: Dailies set to flounder amid a lack of fundamental support

Q2: U.S. Solar and Wind Power by the Numbers

Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

Rate case activity slips, COVID-19 proceedings remain at the forefront in August


AM Power Report: Dailies set to flounder amid a lack of fundamental support

Theprice of power fornext-day delivery could decline Thursday, April 28, as forecasts for easingdemand in much of the country at the close of the workweek conspire with anyongoing losses at the natural gas futures complex.

Relinquishing 3.7 cents in the prior session, Mayfutures rolled off the board April 27, with the new front-month June natural gasfutures contract also weaker. At last look ahead of the opening bell Thursday,the contract was pegged at $2.128/MMBtu, down 2.5 cents, against a backdrop ofanticipated demand erosion and ongoing storage building.

Lackluster demand should begin to drive larger storageinjections after a slow start to the injection season. The U.S. EnergyInformation Administration is expected to report the first double-digitinjection of the season when it releases its latest storage report at 10:30a.m. ET. Market participants and analysts are looking for an for the weekended April 22.

Interms of demand, most grid operators in the country anticipate softer load atthe end of the workweek, when business-related demand typically wanesapproaching the weekend break.

Inthe Northeast, demand in New England will likely top out at 14,170 MW onThursday and 13,650 MW on Friday, while New York load could reach highs at17,915 MW in the latter part of the workweek and 17,517 MW on Friday. To thesouth, demand in PJM Western region is expected to crest at 46,517 MW onThursday and 45,650 MW on Friday, while PJM Mid-Atlantic load should near30,392 MW on Thursday and 29,458 MW on Friday.

Inthe Midwest, PJM AEP region demand could peak at 14,626 MW on Thursday and14,444 MW on Friday, while PJM ComEd load will likely hit a high at 11,205 MWon Thursday and 11,056 MW at the close of the business week.

Inthe South, load in ERCOT is projected to see highs at 49,908 MW on Thursday and48,115 MW on Friday. In the West, demand in CAISO could touch ahigh near 28,085 MW on Thursday and 28,186 MW at the end of the workweek.Products out West will include the typically altered package Thursday tofeature the two-day, partly weekend products for Friday-Saturday delivery.

Inforward trading, power prices for May predominantly unraveled at midweek, asweakness at the natural gas futures arena implied cheaper fueling costs.

Inthe East, front-month power products gave back near 60 cents in trades done atalmost $31 at NEPOOL-Mass and shed about $1 in deals carried out atop $32 atPJM West, while power parcels for June delivery were transacted also in the low$30s in New England and in the high $30s at PJM West.

Inthe Midwest, price activity for May power recoiled by a little over 60 cents toan index at roughly $30 at PJM AD and slumped by almost 20 cents to an averageat about $27 at PJM Northern Illinois, as MISO Indiana May pricing eased byaround 10 cents to an index at close to $29. Along the forward curve, powervalues for June across the three hubs were pegged in the high $20s to the low$30s.

Inthe South, losses of about 70 cents to 80 cents steered month-ahead powerpricing to indexes near $24 at ERCOT Houston and around $22 at the rest of theERCOT markets, as regional price action for June power delivery ran through thehigh $20s overall.

Inthe West, California saw power deals for May falter by about 70 cents to anaverage at close to $23 at North Path-15 but hold near unchanged at an index atroughly $21 at South Path-15, as Mid-Columbia May retreated by around 10 centsto an average at almost $14 and Palo Verde May advanced by near 40 centsagainst the wider decline to an index at above $19. Power transactions for Junewere discussed in the high $10s at Mid-Columbia and in the low to mid-$20selsewhere in the region.

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Marketprices and included industry data are current as of the time of publication andare subject to change. For more detailed market data, including power and natural gas indexprices, as well as forwards and futures, visitour Commodities Pages.