POWER MARKETS
WEST Spot prices have risen this week in response to colder weather and winter storms in the Pacific Northwest. After a bomb cyclone hit Washington on Tuesday, triggering widespread outages, prices leapt by $14/MWh in Mid-C. They spiked in NP15 as well, not only because of the cyclone but also because of heavy cloud coverage that suppressed behind-the-meter solar generation. Across the board, the Day Ahead averages for the month to date have increased to $29.24/MWh in Mid-C, $42.46/MWh in NP15, and $30.95/MWh in SP15. Although the grid is expected to have enough supply to accommodate the growth in demand projected as December approaches and forecasts predict continued drops in temperature, power prices should nonetheless keep climbing alongside natural gas spot prices.
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ERCOT As forecasts have begun to tell a colder story and ignited an impressive rally in the term natural gas markets, where prices have gained $0.05-$0.30/MMBtu, depending on term, term power prices, in turn, have gained $1.50-$3.00/MWh, depending on term, since last week. Real-time prices are still relatively low, although variable wind output during the critical evening hours should keep them rather volatile. Indeed, the load shape during this onset of cold weather cautions high prices both during the morning ramp and in the standard evening hours, when solar is minimal.
EAST Mirroring their geographic distribution, prices this week have decreased in PJM, re-mained flat in NYISO, and ascended in ISO-NE, where the Seabrook nuclear plant remains offline after its unexpected trip. On the week, Day Ahead prices are averaging $30.18/MWh in PJM, $36.48/MWh in NYISO, and $41.56/MWh in ISO-NE's WCMASS while Real Time prices are averaging $28.68/MWh, $34.42/MWh, and $47.41/MWh, respectively. Although, next week, the weather should cool by Thanksgiving after a warm start, the usual holiday downturn in demand may temper any volatility in LMPs otherwise expected from an increase in heating load.