Next-day power markets were mostly higher Wednesday, Dec. 27, as mixed load forecasts for the end of the week were met by natural gas price gains.
At the futures market, the January 2018 gas futures contract settled and expired at $2.738/MMBtu, rising 9.5 cents. February 2018 natural gas futures ended the day at $2.732/MMBtu, up 7.8 cents.
The natural gas futures market was stronger Wednesday, as colder weather outlooks for the medium term are likely to boost natural gas demand.
Next-day natural gas prices were mostly stronger Wednesday, with cold weather in many areas, strong demand and pipeline constraints in parts of the Northeast working to push values to the upside.
Northeast power markets continue to rise amid bullish fundamentals
Power prices for Thursday delivery in the Northeast continued to advance, rallying again at some regional locations, with gains driven by cold weather, increased demand and a simultaneous spike in regional gas values.
Peak power at the PJM West hub in the mid-Atlantic was reported in the low $100s to mid-$120s, rising about $40 on the session. At the NEPOOL-Mass hub, on-peak power traded in the mid-$180s to low $200s, rising from the low $170s to low $200s the day prior.
Spot natural gas at the Transco M3 market posted an index at $17.12/MMBtu, up $5.50. Gas at the Algonquin market surged Dec. 26 to near $53.00/MMBtu but dropped almost $30.00/MMBtu to an index near $25.00/MMBtu at midweek.
Day-ahead market prices for Thursday also jumped, posting averages at $167.36 at NEPOOL-Mass, up $28.00. DAMS for Thursday averaged $59.70 at New York's Zone A, $157.92 at Zone G and $169.06 at Zone J.
Load in New England is expected to hit 20,400 MW on Thursday, up 1,100 MW from Wednesday. Demand in New York load is anticipated to crest at 23,250 MW on Thursday, down 150 MW from a day earlier.
Demand in the mid-Atlantic's PJM Western region is seen reaching 65,300 MW on Thursday, down 1,000 MW from midweek. Load in the PJM Mid-Atlantic region is projected to peak at 44,500 MW on Thursday, climbing 2,200 MW from Wednesday.
Midwest prices climb as gas gains offset expected demand downturn
Next-day power prices in the Midwest also advanced during the Wednesday session, as regional gas market gains ran counter to an anticipated downturn in demand.
At the Indiana hub, peak parcels for Thursday ran in the low to high $40s, up more than $6.
Midwest natural gas values also worked higher at midweek. Spot gas in Chicago came in near $3.15/MMBtu, rising about 25 cents.
Demand at the PJM AEP region is expected to reach 20,660 MW on Thursday, decreasing 500 MW on Wednesday. Load in the PJM ComEd region near Chicago is pegged to hit 14,800 MW on Thursday, down 200 MW from Wednesday.
Most West Coast power prices advance with strength in gas, load
Daily power markets on the West Coast were mixed but mostly higher Wednesday, with strength in regional gas prices and rising demand offering support. California load is expected to reach 29,350 MW on Thursday, up 450 MW from Wednesday.
Due to the upcoming weekend and New Year's Day holiday on Jan. 1, 2018, power was booked Wednesday for delivery Dec. 28-29.
In the Northwest, Mid-Columbia heavy-load parcels were inked in the mid-$20s, down about $3 or so. Light-load power deals at Mid-C were inked in the low $20s.
In the Southwest, heavy-load power at Palo Verde was quoted in the mid- to upper $20s, as heavy-load power at Mead assessed in the low $30s. Both markets gained several dollars on the day. The light-load markets in the Southwest ran in the mid- to high $20s.
Gains in regional gas values helped to support the advance at most regional power markets. Spot gas at PG&E Citygates came in at an average around $2.90, up 5 cents on the day.
Strong demand, gas boost Texas power DAMs
In Texas, day-ahead market values were firm to about $2 higher at midweek, garnering strength from an anticipated uptick in demand forecast and gains for regional gas prices.
DAM prices for Thursday came in at $25.00 at ERCOT Houston, $26.10 at ERCOT North, $26.32 at ERCOT West and $27.60 at ERCOT South.
Next-day natural gas at the benchmark Henry Hub market rose 5 cents to an average around $2.75/MMBtu.
ERCOT load is seen topping out at 50,900 MW on Thursday, rising 1,100 MW from Wednesday.
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.