Power prices decline, new PTC rates in IL

Electricity prices fall across the country. Ameren IL and COMED posted new PTC charges, 12.2 GW of wind capacity additions expected for 2019, and heat coming to East Coast to begin October.



General Update

  • The October 2019 NYMEX Henry Hub forward contract climbed to $2.637/MMBtu, a $0.09 (3.3%) increase from the previous Wednesday. The price of the 12-month strip averaging October 2019 through September 2020 futures contracts increased $0.03 (1.0%) to $2.587/MMBtu.

  • Natural gas prices have fallen in Northeast markets since last week. Boston’s Algonquin Citygate prices decreased -$0.24 (-10.1%) to $2.14/MMBtu last Wednesday, and Transco Zone 6 NYC prices decreased, falling -$0.29 (-12.6%) from $2.30/MMBtu to $2.01/MMBtu.

  • Pennsylvania’s Dominion South decreased -$0.02 (-1.0%) to $1.98/MMBtu. Tennessee Zone 4 Marcellus spot prices decreased -$0.12 (-6.0%) to $1.87/MMBtu.

  • California prices have slipped downward since last week. SoCal Citygate prices decreased -$0.14 (-4.2%) to $3.18/MMBtu last Wednesday. Prices at Northern California PG&E Citygate decreased, falling -$0.12 (-3.7%) to $3.11/MMBtu.

Power

  • For the NYC zone (J) in NYISO, the 12 Month ATC strip decreased -$1.51 (-3.9%) to $37.03.The 24 Month ATC strip decreased -$1.03 (-2.7%) to $37.70 and the Cal 2020 ATC strip decreased -$1.08 (-2.8%) to $38.05.

  • For the NEMASSBOST zone in ISONE, the 12 Month ATC strip decreased -$0.87 (-2.1%) to $41.11. The 24 Month ATC strip decreased -$0.58 (-1.4%) to $41.48 and the Cal 2020 ATC strip decreased -$0.49 (-1.2%) to $41.93.

  • For the PEPCO zone in PJM, the 12 Month ATC strip decreased -$0.89 (-2.5%) to $34.38. The 24 Month ATC strip decreased -$0.59 (-1.7%) to $33.77 and the Cal 2020 ATC strip decreased -$0.59 (-1.7%) to $33.87.

  • For the Houston zone in ERCOT, the 12 Month ATC strip decreased -$0.68 (-1.6%) to $42.35.The 24 Month ATC strip decreased -$0.17 (-0.4%) to $39.61 and the Cal 2020 ATC strip decreased -$0.16 (-0.4%) to $42.02.

Utility Highlight

  • The upcoming Price to Compare for Rhode Island’s Narragansett Electric Company (National Grid) Residential rate class (A-16) is $0.10957/kWh, in effect from October 1, 2019 to March 31, 2020. This rate is an 18.6% increase from the current rate of $0.0924/kWh for the April 1, 2019 to September 30, 2019 price period.

  • TRUELight’s expert analytics and proprietary models indicate that headroom in the National Grid territory is now available in the 1, 3, 9 and 12 month terms. Headroom of $0.00439/kWh and $0.01282/kWh is likely for the 9 and 12 month terms, respectively.

  • Over the last week, the RHODEISLAND ATC 12-month strip decreased, falling -2.1% to finish at $40.62/MWh yesterday. This time last year, the strip was trading at $48.40/MWh, which is 19.1% higher than this year.

  • Since the beginning of the year, the ATC strip has reached a high of $47.96/MWh on January 17, 2019 and a low of $38.12/MWh on July 5, 2019.

Natural Gas

  • For the week ending September 13, the EIA reported net injections from storage of 84 Bcf, which is identical to last year’s net injections of 84 Bcf for this week and higher than the 5-year (2014–18) average net injections of 82 Bcf.

  • Working natural gas in storage totaled 3,103 Bcf, which is 393 Bcf (14.5%) more than last year’s working gas totals of 2,710 Bcf at the same time and 75 Bcf (-2.4%) lower than the 5-year (2014-2018) average of 3,178 Bcf. Total working gas is within the five-year historical range.

Supply and Demand

  • Average total supply of natural gas remained constant week/week. Dry natural gas production remained the same while net imports with Canada increased 1% compared with the previous week.

  • Total US consumption of natural gas decreased by 4% since last week. Consumption for power generation decreased 5% week/week, industrial sector consumption decreased 1%, residential-commercial consumption decreased 1%, and exports to Mexico decreased 1%.

  • US LNG exports increased week/week, with twelve vessels departing US ports for a combined 42 Bcf.

Market Intelligence

  • Ameren Illinois has filed new Retail Purchased Electricity Charges (PEC), the largest component of its price-to-compare (PTC), following the conclusion of its Fall 2019 block energy procurement. Effective October 1, 2019, the Retail PEC for residential customers (BGS-1) is 3.585 cents/kWh for usage up to 800 kWh and 3.246 cents/kWh for usage beyond 800 kWh, and the Retail PEC for small commercial customers with secondary voltage (BGS-2) is 4.214 cents/kWh. These represent a 4.6% increase and a 5.6% increase compared to current rates for residential (0-800 kWh) and small commercial customers, respectively.

  • COMED filed new Purchased Electricity Charges (PEC) effective October 1, 2019 after their most recent energy procurement. The PEC for Residential customers is 5.998 cents/kWh, a 7% increase from the current rate of 5.608 cents/kWh. The PEC for Demand Non-Electric Space Heating customers is 6.054 cents/kWh, a 6.8% increase from the current rate of 5.668 cents/kWh. COMED also filed new PJM Services Charges, another component of the PTC, effective October 1, 2019.

  • The Energy Information Administration (EIA) expects to see a near record amount of wind capacity additions by the end of 2019. With 3.7 gigawatts (GW) of capacity added through the end of June, EIA foresees additional capacity of 8.5 GW to come online, bringing the total to 12.2 GW by year’s end. The record level of annual wind capacity additions came in 2012 at 13.2 GW, but in 2020 expectations are that a record 14.3 GW of additional wind capacity will become operational.

Weather

  • Forecasts for the 8-14 day window call for above average temperatures for most of the East Coast, stretching all the way from Texas eastward. The most extreme high temperature anomalies will affect the Southeast. The western continental U.S. will see below average temperatures as we move into October.

  • Stormy weather is expected to bring above-average levels of rain to the Midwest, concentrating in the Plains, upper Mississippi River Valley, and Great Lakes regions. The Atlantic coast will see drier than average conditions, and the majority of the West Coast will see about average precipitation.

© 2019 by TRUELight Energy LLC

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