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AM Power Report: Dailies could end week varied amid indecisive fundamentals

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AM Power Report: Dailies could end week varied amid indecisive fundamentals

Power dailies could end the workweek with a mixed showing Friday, Feb. 3, as diverging demand forecasts for the start of the next business week combine with stalled natural gas futures trading activity.

Tacking on 1.9 cents in the prior session, March natural gas futures were aimed lower early Friday. At last look, the contract was down 9.6 cents to trade near $3.291/MMBtu on profit-taking and fresh selling ahead of the weekend.

In line with any sustained losses for futures Friday, day-ahead natural gas prices at most market hubs are likely to slide Friday amid additional pressure from the inclusion of the lower-load weekend days in the trading product.

In terms of demand, load outlooks for the start of the next workweek Feb. 6 are pointed higher for the Northeast but lower elsewhere in the country, even as business-related demand typically rebounds coming off the weekend break.

In the Northeast, load in New England is expected to top out at 17,250 MW on Friday and 17,600 MW on Feb. 6, while New York demand is seen cresting at 20,741 MW on Friday and 21,095 MW at the return of the business week. In the Mid-Atlantic, load in PJM Western region is called to reach 58,815 MW on Friday and 55,422 MW on Feb. 6, while demand in PJM Mid-Atlantic is projected to hit highs at 38,538 MW on Friday and 37,258 MW on Feb. 6.

In the Midwest, PJM AEP region load is poised to see highs at 18,814 MW on Friday and 17,707 MW at the start of the next workweek, while PJM ComEd demand is projected to peak at 13,320 MW on Friday and 13,032 MW on Feb. 6.

In the South, ERCOT load should near 42,235 MW on Friday and 39,488 MW on Feb. 6.

In the West, demand in California could reach highs at 29,200 MW on Friday and 26,800 MW on Feb. 4, but should find some upside support on Feb. 6 as full industrial and commercial demand returns at the start of the new business week.

In forward trade, price action for March power was predominantly biased lower Feb. 2, even as front-month natural gas futures extended higher on the session to ultimately keep fueling costs elevated.

In the East, power deals for March unraveled over $1 to average almost $45 at NEPOOL-Mass and about $36 at PJM West, while power transactions for delivery in April were carried out in the high $30s in New England and in the low $30s at PJM West.

In the Midwest, pricing for month-ahead power retreated by about 80 cents to an index atop $34 at PJM AD and fell by more than $1 to an average near $32 at PJM Northern Illinois, but advanced by roughly 10 cents against the broad downtrend to an index at above $37 at MISO Indiana. Looking ahead, power values for April across the three hubs were likewise spread in the low to high $30s.

In the South, the front-month power offering added almost $2 against the dominant decline in deals done near $35 at ERCOT Houston but shed more than $1 in transactions averaging roughly from $24 to $28 at the rest of the ERCOT markets. Regional trading activity for April power spanned the low $20s to the high $30s.

In the West, California saw power prices for March tack on about 60 cents to average atop $30 at North Path-15 but deflate by almost 60 cents to an index at $26 at South Path-15, as prompt-month values recoiled by 80 cents to average above $20 at Mid-Columbia but climbed by 50 cents to an index above $24 at Palo Verde. Price action for April power was spotted in the high $10s at Mid-Columbia 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.