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AM Power Report: Dailies likely to chop around ahead of holiday weekend

Day-ahead power markets are likely to see choppy moves in the week's and the year's closing session Friday, Dec. 30, as traders look to varied demand projections after the New Year's holiday and recent losses for natural gas. Markets will be closed Monday, Jan. 2, in observance of the New Year's holiday.

Recently taking over as the front-month contract, and after losing 9.6 cents in the prior session, February 2017 natural gas futures were little changed early Friday ahead of the opening bell. At last look, the contract was up just 0.7 cent to trade near $3.809/MMBtu after the U.S. Energy Information Administration reported on Dec. 29 a larger-than-anticipated storage withdrawal that erased the year-on-five-year-average storage surplus.

Ahead of the impending weekend and holiday, next-day gas trades Friday will be booked for Jan. 1-3, with the inclusion of what is typically the lighter-load days in the product likely to offer pressure.

According to forecasts from AccuWeather.com, a winter storm dumping a wintry mix in the Mid-Atlantic and blizzard conditions to northern New England will continue into Friday. "Blizzard conditions are most likely to develop from northern New Hampshire to northwestern Maine. Snowfall totals in this area could range from 12 to 18 inches, while increasing winds could cause whiteout conditions," AccuWeather.com said.

However, despite the bullish weather, and amid the upcoming holiday, demand generally looks to dip over the weekend in these regions and elsewhere across the country before rebounding at the start of the truncated workweek Jan. 3.

Demand in New England is seen peaking at 17,250 MW on Friday, 17,950 MW on Jan. 2 and 17,360 MW on Jan. 3. Load in New York is expected to reach 21,250 MW on Friday, 18,000 MW on Jan. 2 and 19,475 MW on Jan. 3.

In the Mid-Atlantic, PJM Western load is likely to crest at 55,300 MW on Friday, 49,150 MW on Jan. 2 and 51,500 MW on Jan. 3. PJM Mid-Atlantic region demand could top out at 35,750 MW on Friday, 33,200 MW on Jan. 2 and 35,300 MW on Jan. 3.

In the Midwest, demand in the PJM AEP region is expected to top out near 17,150 MW on Friday, 15,150 MW on Jan. 2 and 15,300 MW on Jan. 3. Load in the PJM ComEd region near Chicago is called to peak at about 13,000 MW on Friday, 11,960 MW on Jan. 2 and 12,615 MW on Jan. 3.

Demand in Texas should top out near 38,800 MW on Friday, 42,400 MW on Jan. 2 and 40,000 MW on Jan. 3, according to the ERCOT grid operator.

Term power markets around the country were mixed to mostly lower in the Dec. 29 session, with the losses in natural gas futures signaling weaker fueling costs for U.S. power generators.

In the Northeast, New England January 2017 power parcels traded in the mid-$80s, with New York's Zone G parcels running in the low $70s. January 2017 delivery power at the PJM West hub in the Mid-Atlantic was quoted in the low $50s.

In the Midwest, January 2017 power at PJM AD and MISO Indiana was pegged in the upper $40s, while January 2017 packages at Northern Illinois were seen in the mid-$40s.

At the ERCOT North market in Texas, both January 2017 and first quarter 2017 power packages ran in the mid-$30s.

On the West Coast, January 2017 power packages at South Path-15 in California were seen in the low $40s, with first-quarter 2017 deals inked in the mid-$30s. In the Northwest, power for January 2017 at Mid-Columbia was eyed in the low $40s, with deals for the first quarter of 2017 marked in the low $30s. At Southwestern markets, Palo Verde power deals for January 2017 were seen in the low $30s, with the first-quarter of 2017 assessed in the high $20s.

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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.