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Power dailies kick off workweek higher; NEPOOL-Mass flounders

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Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

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Power dailies kick off workweek higher; NEPOOL-Mass flounders

Next-day power markets across the U.S., with the exception of deals done at NEPOOL-Mass, were biased higher Monday, Dec. 12, despite downward pressures from varied Tuesday load forecasts and predominantly lower spot natural gas prices.

After ending the previous week on the upside, losses dominated trading in the natural gas futures arena with the front-month January 2017 contract falling by 23.9 cents to settle at $3.507/MMBtu. Likewise, spot gas markets ticked lower with only values at NNG Demarc moving the other way.

Lending support, AccuWeather.com forecasts that the central and eastern United States may see temperatures tumble to dangerous levels this week as piercing cold passes through the regions.

West dailies start workweek with demand support

Values in the West leaned flat to higher Monday as projections of robust Tuesday demand counterbalanced a fall in spot gas prices.

Northwest markets saw the biggest gains of the session with packages adding about $7 to $9 from Dec. 9 and spanning the mid-$40s to low $50s at Mid-Columbia and the high $40s to low $50s at COB. In California, power prices at North Path-15 and South Path-15 saw little change as power was transacted in the low $40s. Hubs in the Southwest gained roughly $2 with dailies done in the low $30s at Palo Verde and the mid-$30s at Mead.

The California ISO expects demand to run up to 30,612 MW on Tuesday, up more than 400 MW from Monday.

Midwest values tick higher on demand forecasts, cold weather

Outlooks calling for elevated Tuesday demand alongside impending cold weather helped dailies in the Midwest notch gains Monday but with mixed spot gas prices limiting the upside.

PJM AEP-Dayton traded power more than a dollar higher from Dec. 9 in the high $30s, while MISO Indiana saw power deals add almost $3 and ranged in the low $40s.

Regional load forecasts are aimed higher with the PJM AEP region and PJM ComEd region anticipating demand to rise by 400 MW to 500 MW from Monday to hit Tuesday peaks of 17,859 MW and 14,526 MW, respectively.

Texas dailies firm despite slack fundamentals

Declining demand forecasts and sluggish spot gas prices failed to keep most power values in Texas lower Monday.

At ERCOT North, next-day deals were steady to Dec. 9 and spanned the high $20s.

Day-ahead markets leaned mixed to higher. DAMS at ERCOT Houston added roughly $4 and averaged $31.95, while DAMs at ERCOT South and ERCOT West gained less than a dollar and averaged $29.47 and $27.49, respectively. DAMs at ERCOT North ran the other way and shed less than $1 to average $27.11.

In addition, trades at Into Southern were pegged in the low $30s, down about a dollar from Dec. 9.

Demand in Texas may see a Tuesday high near 40,005 MW, down about 1,100 MW from Monday.

NEPOOL-Mass retreats on gas losses; other East markets firm

Trading activity in the East was mixed Monday as values saw little support from soft spot gas prices and choppy Tuesday load forecasts.

Across next-day markets, power at NEPOOL-Mass was exchanged in the low $50s, down from a Dec. 9 index of $78.00, while dailies at New York Zone G and PJM West saw little change from Dec. 9 with deals in the low $50s and mid- to high $30s, respectively.

Day-ahead markets were pointed mostly lower. DAMs at NEPOOL-Mass tumbled by more than $10 and averaged $57.78 while DAMs at New York Zone G and New York Zone J shed more than $5 and averaged $51.33 and $51.96, respectively. DAMs at New York Zone A defied the downtrend and added roughly $5 to average $27.97.

Demand in the Northeast is off to a slow start with New England and New York called to see load fall by 400 MW to 600 MW from Monday to near Tuesday highs of 17,900 MW and 20,800 MW, respectively. Mid-Atlantic demand outlooks are higher. Load in the PJM Mid-Atlantic region may top out at 38,566 MW on Tuesday, up almost 350 MW from Monday, while demand in the PJM Western region could crest at 59,544 MW on Tuesday, increasing more than 1,300 MW from Monday.

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, natural gas and coal index prices, as well as forwards and futures, visit our Commodities Pages.