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AM Power Report: Dailies could open week bolstered by load outlooks, gas

The price of next-day power could open the new workweek elevated Monday, Aug. 14, as forecasts for predominantly stronger demand on Tuesday combine with fresh gains at the natural gas futures complex.

Ending the Aug. 11 session near unchanged, NYMEX front-month natural gas futures were advancing above $3.00/MMBtu early Monday ahead of the opening bell. At 6:40 a.m. ET, the September gas futures contract was up 2.3 cents to trade near $3.006/MMBtu, amid more supportive weather forecasts that suggest increased demand for natural gas in the coming weeks.

Next-day natural gas prices at major consuming hubs are likely to climb in many cases at the start of the workweek, in tandem with the early gains in futures Monday.

In terms of demand, most grid operators across the country see rising load as the fresh workweek unfolds.

In the Northeast, demand in New England could touch a high near 19,140 MW on Monday and 20,100 MW on Tuesday, while load in New York could top out at 23,713 MW on Monday and 24,647 MW on Tuesday. Farther south, PJM Western region demand is called to reach 63,155 MW on Monday and 66,133 MW on Tuesday, while PJM Mid-Atlantic load is forecast to peak at 42,733 MW at the return of the workweek and 43,621 MW on Tuesday.

In the Midwest, demand in the PJM AEP region is poised to crest at 18,659 MW on Monday and 19,234 MW on Tuesday, while load in PJM ComEd could reach highs at 15,727 MW on Monday and 16,585 MW on Tuesday.

In the South, load in Texas will likely see highs at 67,753 MW at the start of the new business week and 67,990 MW on Tuesday. In the West, demand in California should near 35,665 MW on Monday and 34,400 MW on Tuesday.

Along the forward curve, power prices for September were mixed but mostly lower ahead of the weekend, as weakness at the natural gas futures arena implied cheaper fueling costs.

In the East, prompt-month power transactions shed about 10 cents to average atop $31 in New England and deflated by roughly 70 cents to an index at almost $33 at PJM West. Power deals for October were done in the high $20s in New England and also in the low $30s at PJM West.

In the Midwest, pricing for September power at the PJM Interconnection markets saw a 20-cent gain at an index close to $33 at the AD hub and a 10-cent advance to an average at about $32 at the Northern Illinois hub. MISO Indiana September price action fell by around 30 cents to an index at almost $34. Farther along the forward curve, power values for October across the three hubs spanned the low to mid-$30s.

In the South, ERCOT North September was flat day on day at an average at above $30, while month-ahead power at the rest of the ERCOT markets were off about 10 cents to 30 cents at indexes spread from near $30 to atop $34. The power offering for October delivery across the region was quoted in the mid-$20s to the mid-$30s.

In the West, near $1 losses steered front-month power trades to indexes at almost $39 at both North Path-15 and South Path-15 in California, as a 55-cent slump took Mid-Columbia September to an average at roughly $28 and at 40-cent increase drove Palo Verde September to an average close to $31. Power transactions for October were assessed 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.