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 Decem-ber 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 weath-er 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.