Peak power prices across the West picked up between $4 and as much as $18.25 in trading this week, a portion of which can be attributed to greater California demand and extreme heat across the Southwest.
Between Aug. 12 and Aug. 15, California ISO demand increased about 15 percent, with what should prove the week’s high of 44,129 MW reached Aug. 15.
Total renewables on the CAISO grid reached 15,849 MW Aug. 10, providing roughly 49 percent of demand. Thermal generation sources fulfilled 21,215 MW, or about 48 percent, of demand Aug. 14.
Daytime power prices in the region added as much as $18.25 in Aug. 8 to Aug. 15 trading. Palo Verde experienced the greatest gains, adding $18.25 to reach $51.75/MWh.
Temperatures in the Desert Southwest climbed above averages for this time of year to around 110 degrees Fahrenheit Aug. 14 and 15. Some daytime highs approached records, according to Accuweather, which is forecasting near-record heat again Aug. 19 and 20 in areas such as Palm Springs, Phoenix and Las Vegas.
Following suit, Western nighttime values picked up between $1 and as much as $10 by the end of trading. The Palo Verde off-peak price added $10 to reach $33.75/MWh. Nighttime power prices ranged from $24/MWh at Mid-Columbia to $33.75/MWh at South of Path 15.
Meanwhile, Western natural gas prices added between 9 cents and as much as $1.34 in Aug. 8 to Aug. 15 trading. El Paso-Permian Basin natural gas added the most, jumping $1.34 to $1.55/MMBtu. Alberta natural gas was the exception, tumbling 76 cents to 38 cents/MMBtu.
Henry Hub gas spot prices added 3 cents in trading to end at $2.14/MMBtu.
Working natural gas in storage was 2,738 Bcf as of Aug. 9, according to the U.S. Energy Information Administration. This is a net increase of 49 Bcf compared with the previous week.
“Prices in Southern California traded in a wide range of $1.31/MMBtu throughout the report week as a result of continued supply constraints in the area,” the EIA said in its weekly report. SoCal CityGate ended above $3 at $3.11/MMBtu. PG&E CityGate closed the trading period at $2.58/MMBtu, and SoCal Border ended at $2.56/MMBtu.
Nationally, the EIA said, natural gas production set a new record of 92.1 Bcf per day Aug. 5. Production levels have continued increasing in August despite relatively low natural gas spot prices.
Agency analysts also noted that natural gas spot prices “have been on a downward trend since early spring,” with Henry Hub spot gas prices at a multiyear low. The spot price at the hub was $2.02/MMBtu, the lowest recorded since May 30, 2016, EIA said.