Weekly Energy Market Updates by Region - Archive




Issue week: July 9th, 2020  (Wk 28)





WEST Since the reopening of commercial activity, demand has rebounded slightly and been relatively stable over the past month. Nonetheless, amid healthy volumes of natural gas stockpiles and projections of hydro genera-tion at 106% of normal, forward prices have fallen.

ERCOT  Term prices have climbed by $0.20-$0.50/MWh this week, mainly because of an increase in term natural gas prices. Moreover, each day this week has featured an hour or so of triple-digit real-time prices, which have brought the MTD averages for the different load zones out of the cellar and into the low $20s/MWh. The ORDC adder has also shown signs of life, hav-ing settled near $3.00/MWh for the month.

EAST This has been a strong week for summer demand and attendant prices in PJM. Three peaks have been set this week so far, and another peak is likely today. RT prices are averaging $35/MWh during on-peak hours this week and have been as high as $141/MWh during the high-demand midday hours. The overall DART spread in PJM for those on-peak hours is about $4/MWh for the week. Over in ISO-NE today, demand is meeting expectations, DA prices have leapt by an average of $8/MWh from yesterday in the on-peak hours, and RT prices have so far followed the increase in DA prices.









As the number of COVID-19 cases continues to climb nation-wide, trying to anticipate regional shutdown efforts going for-ward might be a fool’s errand. However, it is increasingly evi-dent that, for various reasons (political and otherwise), the full-scale lockdowns endured in the spring seem unlikely to be repeated. Consequently, energy demand has already ap-proached pre-pandemic summer expectations in most ISOs. Commercial and industrial facilities, which decreased their electricity usage significantly in the second quarter, are now largely operating near full capacity (again, at least in terms of electricity usage). This development is not to say that residential usage, which rose sharply in April (as illustrated in the chart below from the U.S. Energy Information Administration), has necessarily subsided. Most work-from-home orders remain in place as temperatures have turned decidedly summerlike, so residen-tial electricity consumption is still steadily increasing. Whatever the extent of the continuation (or return) of shut-downs, high energy demand has arrived. Indeed, this week’s warm weather has triggered CORE alerts from Calpine Ener-gy Solutions throughout the Midwest and Northeast. Summer-peak prices are almost certain to loom ahead, and future ca-pacity charges need to be monitored closely as well. Fortu-nately, Calpine Energy Solutions stands ready to help navi-gate the gauntlet of energy expenses 




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