With an excessive-heat warning and heat advisories issued across the western United States, the anticipation of higher demand bolstered regional energy prices with the potential for prices to trend higher still as the heat persists.
More than 32 million Californians live in an area now under an excessive-heat warning or heat advisory, according to National Weather Service Sacramento, which also expects this to be the longest triple-digit heat wave this year. The heat could continue through the end of August.
Various NWS offices report that the "dangerously hot temperatures"—with daytime highs expected to reach up to 116 degrees Fahrenheit in Phoenix Aug. 14 and 113 in the San Joaquin Valley into the week of Aug. 17—should last through at least Aug. 19 for California and Arizona. Affected Oregon and Washington areas should see some relief by either Aug. 17 or 18.
The California Independent System Operator issued a Flex Alert from 3 p.m. until 10 p.m. Aug. 14. Demand on the grid peaked at 42,053 MW Aug. 13; however, the week's high use is expected to occur Aug. 14, when demand is forecast to reach 46,484 MW. It is worth noting that the forecast peak was adjusted by 750 MW. It had been 45,734 MW at roughly 7 a.m. on Aug. 14.
Renewable resources supplied CAISO with 15,080 MW, meeting roughly 41 percent of demand, Aug. 11. Thermal generation reached 23,997 MW Aug. 13, which represented almost 57 percent of demand.
Western daytime power prices gained between $10.50 and as much as $49.80 in Aug. 6 to Aug. 13 trading. Palo Verde peak power values rose $49.80 to $71/MWh. By Aug. 13, prices ranged from $23.10/MWh at Mid-Columbia to $71/MWh at Palo Verde.
Off-peak power prices gained between $2.95 and $7.25 in trading. Mid-C values gained the most, adding $7.25 to reach $14.95/MWh. At the end of trading, nighttime power values across the region ranged from $14.95/MWh at Mid-C to $27.05/MWh at South of Path 15.
Meanwhile, Western natural gas prices also rose in Aug. 6 to Aug. 13 trading. Prices in California took more of a leap, with SoCal CityGate natural gas surging $2.45 to $4.46/MMBtu and Southern California Border gas jumping $1.95 to $3.83/MMBtu. Most hub prices, save at Alberta and El Paso-Permian Basin, traded above the $2 mark by Aug. 14. Henry Hub natural gas values, however, shed 8 cents to $2.12/MMBtu.
Southern California Gas Co., in an Aug. 10 update posted on ENVOY, reported that numerous repairs on Line 235-2 have been successfully completed and that "the re-pressurization process is currently progressing without delays." It expects the line to return to service Sept. 1.
The utility is making withdrawals from its Aliso Canyon storage facility Aug. 17 as part of its ongoing testing.
What's ahead: With the oppressive heat expected to persist in the region through at least Aug. 19, CAISO demand is expected to reach 47,700 MW Aug. 18.