WEST High temperatures in the Pacific Northwest and California have pushed index prices up over the past week. In California, they have peaked above $100/MWh since Tuesday. In con-trast, forward prices keep trending down on the back of strong natural gas inventories amid increased reliance on natural gas pipelines to meet daily demand.
ERCOT Having opened July around $40/MWh, real-time prices will end up averaging around $20/MWh for the month to highlight the potential benefits of having at least some in-dex exposure, even during volatile summer months. Despite high loads in the middle of the month, 4CP load curtailments and high wind output helped maintain sufficient reserve mar-gins. Although real-time prices have continued to average below $20/MWh over just the past week, outages related to Tropical Storm Hanna increased congestion in the South Load Zone to raise its average to $25/MWh. August 5x16 has fallen by approximately $30/MWh over the past month and, at $65/MWh, now presents a compelling buying opportunity for customers with remaining open positions for next month. In the forward market, the prompt 12-month 7x24 curve is now around $29/MWh, eliminating much of the steep backwardation present less than a month ago. The prompt 12-month strip is trading at a premium of only $1/MWh to 12-month strips down the curve.
EAST During the summer heatwave punishing the Northeast, DA and RT prices have stayed relatively stable, mostly in the mid-$20s/MWh, since last week. The largest increase is in ISO-NE, where DA prices are printing $4/MWh over last week and RT prices are printing $7/MWh over last week. In MISO, RT prices spiked at $313/MWh on Tuesday evening because of underperforming wind generation but, for the week, are averaging only $4/MWh above last week. Meanwhile, DA prices are lower than last week by $1/MWh.