Natural gas and electricity prices rose this week as Southern California Gas Co. imposed additional restrictions on its system and daytime temperatures surged.
Restrictions at the SoCal Gas Honor Rancho storage facility started July 28 and are scheduled to continue through Sept. 19. The utility is conducting a well-isolation workover as part of its Storage Integrity Management Program, which reduced capacity by 45 MMcf. A separate line item in the schedule notes another 485-MMcf reduction. Work is also scheduled at the La Goleta storage facility in August that is anticipated to restrict storage capacity there.
Natural gas storage injections and withdrawals are already restricted at the Aliso Canyon storage field. A high inventory shut-in for maintenance that began at the facility July 22 is scheduled to end Aug. 6.
The U.S. Energy Information Administration made note of the restrictions in its weekly report after noting regional natural gas prices moved higher in its Wednesday-to-Wednesday trading window. SoCal CityGate natural gas values jumped 84 cents to $2.60/MMBtu July 29.
Western natural gas prices rose by between 13 cents and as much as 92 cents in July 23 to July 30 trading. SoCal CityGate gained 92 cents to $2.60/MMBtu while Southern California Border gained 67 cents, ending at $2.23/MMBtu. The exception was El Paso-Permian Basin natural gas, which shed 26 cents to $1.10/MMBtu.
Henry Hub natural gas values added 7 cents to reach $1.75/MMBtu.
National working natural gas in storage was 3,241 Bcf as of July 24, according to the EIA. This is a net increase of 26 Bcf compared with the previous week. As of July 24, the Pacific region had 313 Bcf of natural gas in storage following a 2-Bcf addition during the EIA report week.
Western power prices posted increases of between $14.75 and as much as $52.05 in July 23 to July 30 trading. Palo Verde daytime power saw the biggest spike, jumping $52.05 to $73.75/MWh. By July 30, peak prices ranged from $36.70/MWh at Mid-Columbia to $73.75/MWh at Palo Verde. Temperatures were due to reach 119 degrees Fahrenheit in Phoenix and across California's lower deserts July 31.
Off-peak power prices also rose, adding between 15 cents and as much as $7.50. Palo Verde nighttime power values gained the most, up $7.50 to $26/MWh. At the end of trading, nighttime power values across the region ranged from $9.25/MWh at Mid-C to $27/MWh at South of Path 15.
California Independent System Operator demand peaked at 39,444 MW July 30; however, the week's high demand was forecast to occur July 31, when grid demand was expected to reach 42,332 MW.
Renewable resources supplied CAISO with 14,672 MW, meeting roughly 37 percent of demand, on July 30. Thermal generation reached 23,252 MW that same day, which represented almost 60 percent of demand.