Electricity Price Trends
PRICE TRENDS AT KEY TRADING POINTS ($/MWH)
ERCOT released their January Demand & Energy Report last week showing that Jan17 peak demand set a new monthly which beat 2016 by 21.1%. However, overall energy usage in Jan17 was down 0.8% from 2016. In cash trading, high wind and outages to both Singleton-Zenith and Jewett-Limestone lead to bearish prices in the northern half of Texas (HB_North and HB_West). The day-ahead/real-time peak spread for HB_North last week (2/6-2/10) averaged $4.76. This positive DART was primarily driven by Wednesday (2/8) when the HB_North peak strip averaged only $10.76 in real-time with four hours clearing negative due to congestion. Heavy congestion was also seen this Sunday with high wind causing the N/W spread to average $7.49 in the day-ahead market and $11.99 in real-time. In the term, the Houston/North spread was traded heavily mid-week with 2Q17 H/N trading $6.25 and the 2019 H/N spread trading up to $2.75.
12 MONTH STRIP PRICE
The eastern power markets have followed in suite with the downward gas move, as significantly warmer weather released over the weekend has softened the markets. In contrast, the bal-day market experienced strength early this morning due to congestion as a result of the outage of one unit at Calvert Cliffs impacting the market. Unit 2, as a planned outage, was removed just after midnight on Sunday to refuel. PJM WH DA for next week is trading down 85 cents, and last traded 29.50. Summer 17 (July17-August17) for PJM WH RT traded down 60 cents this morning, before rebounding to 42.50. The market is starting to shift its focus to consider the impacts of outage season as well as the upcoming summer with the forecasts for the rest of Feb17 visible and warm for most of the country.
Natural Gas Price Trends
NORTHEAST SPOT NATURAL GAS PRICES ($/MMBTU)
The March 17 NYMEX NG contract traded this morning to a new low of $2.952, a level it hasn’t hit in almost three months. It was November 18th of last year that the Mar17 contract opened at $2.95, and since then rallied almost 90 cents to hit a high of $3.822 at the end of December before becoming range bound between $3.10-$3.40 in the last couple of weeks.
NYMEX HH 5-YEAR FUTURES
So far, the storage number for week ending Feb 10 looks like it will be a withdrawal between 130-145 Bcf, compared to the five-year average of 156 Bcf. This past week the EIA withdrawal of 152 Bcf was almost exactly in line with market expectations.