Northeast power prices fall slightly; a shift to natural gas injection

Updated: Jun 14, 2019

Northeast power prices fall slightly. The natural gas storage curve turns upward, as injections exceed withdrawals. New price-to-compare rates in MA and PA.


General Update

  • The May 2019 NYMEX contract decreased $0.04 (-1.4%) to $2.677/MMBtu last Wednesday. The 12-month strip price averaging May 2019 through April 2020 futures contracts declined $0.04/MMBtu (-1.2%) to $2.846/MMBtu.

  • Northeast price changes were mixed. Boston’s Algonquin Citygate prices declined $0.03 (-1.1%) from $2.73/MMBtu the previous Wednesday to $2.70/MMBtu last Wednesday. Transco Zone 6 NYC prices increased $0.11 (4.4%) from $2.50/MMBtu to $2.61/MMBtu.

  • Pennsylvania’s Dominion South rose $0.05 (2.1%) to $2.46/MMBtu. Tennessee Zone 4 Marcellus spot prices rose $0.09 (3.8%) to $2.45/MMBtu.

  • SoCal Citygate prices decreased $0.18 (-4.4%) to $3.91/MMBtu. Prices at Northern California PG&E Citygate increased $0.08 (2.2%) from $3.63/MMBtu the previous Wednesday to $3.71/MMBtu last Wednesday.

Power

  • For the NEMASSBOST zone in ISONE, the 12 Month ATC strip decreased $0.02 (-<0.1%) to $45.86. The 24 Month ATC strip rose $0.13 (0.3%) to $45.50, and the Cal 2020 ATC strip increased $0.24 (0.5%) to $45.35/MWh yesterday.

  • For the NYC zone in NYISO, the 12 Month ATC strip decreased $0.23 (-0.5%) to $42.40. The 24 Month ATC strip decreased $0.04 (-<0.1%) to $42.90 and the Cal 2020 ATC strip increased $0.19 (0.5%) to $42.24/MWh yesterday.

  • For the PEPCO zone in PJM, the 12 Month ATC strip decreased $0.22 (-0.6%) to $38.40. The 24 Month ATC strip decreased $0.17 (-0.4%) to $37.76 and the Cal 2020 ATC strip dropped $0.03 (-<0.1%) to $37.53/MWh yesterday.

  • For the Houston zone in ERCOT, the 12 Month ATC strip decreased $0.06 (-0.1%) to $43.20. The 24 Month ATC strip increased $0.06 (0.1%) to $41.20, and the Cal 2020 ATC strip increased $0.29 (0.7%) to $39.76/MWh yesterday.

Utility Highlight

  • The current Price to Compare for New Hampshire’s PSNH (Eversource) Residential rate class is $0.09985/kWh, in effect from February 1, 2019 to July 31, 2019. This rate is a -5% decrease from the previous rate of $0.09412/kWh for the August 1, 2018 to January 31, 2019 price period.

  • TRUELight's expert analytics and proprietary models indicate that slight headroom in PSNH is available in the 3 and 6 month terms. Headroom of $0.00678/kWh and $0.00639/kWh is likely for the 3 and 6 month terms, respectively. Please contact TRUELight should you need more detailed information about current default rates and headroom, or would like to receive our forecast for future default rates and headroom by market.

  • Over the last week, the New Hampshire ATC 12-month strip has remained virtually unchanged, increasing 0.03% to finish at $45.44/MWh yesterday.

  • Since the beginning of the year, the ATC strip has reached a high of $47.91/MWh on January 17, 2019 and a low of $41.52/MWh about a month later on February 19, 2019.

Natural Gas

  • For the week ending March 29, the EIA reported net injections from storage of 23 Bcf, which is higher than last year’s net injections of -29 Bcf for this week and the 5-year (2014–18) average net injections of -23 Bcf.

  • Working natural gas in storage totaled 1,130 Bcf, which is 228 Bcf (-17%) lower than last year’s level and 505 Bcf (-31%) lower than the five-year average of 1,635 Bcf. Total working gas is within the five-year historical range.

Supply & Demand

  • Average total supply of natural gas remained the same as compared with the previous report week, averaging 94.6 Bcf/day. Dry natural gas production remained the same while net imports from Canada increased by 2%.

  • Total US consumption of natural gas fell by 4%. Consumption for power generation rose by 2%, industrial sector consumption dropped by 1%, residential-commercial consumption dropped by 12% due to mild temperatures, and exports to Mexico increased by 1%, averaging 4.6 Bcf/day.

  • US LNG exports increased week/week, with seven vessels departing US ports for a combined 25.3 Bcf.

Market Intelligence

  • Fitchburg Gas and Electric Light Company, d/b/a Unitil, has filed with the Massachusetts DPU new basic service rates for residential and small general and medium general commercial classes for the period June 2019 through November 2019. The fixed basic service charge for residential (RD-1, RD-2) and Small General (GD-1) commercial customers would fall about 23% from the current rate to $0.09980/kWh beginning June 1, 2019. The fixed rate for Medium General and Outdoor Lighting (GD-2, GD-4, GD-5, SD) commercial customers is set to drop 25% to $0.09169 beginning June 1, 2019. These rates account for the current Basic Service Costs Adder, which has been in effect since December 1, 2018.

  • Duquesne Light default service supply rates are set to fall, according to a filing with the Pennsylvania PUC. The proposed supply charges, which will be effective June 1, 2019, reflect only generation supply, whereas yet-to-be posted PTC rates also reflect transmission and the state tax adjustment surcharge. The supply charges will be $0.058822/kWh (-3%) for Residential customers (Rate Schedules RS, RH and RA), $0.054951/kWh (-5%) for Small Commercial & Industrial customers (<25 kW, Rate Schedules GS/GM and GMH and Rate Schedule UMS), $0.052092/kWh (-19%) for Medium Commercial & Industrial customers (25-200 kW, Rate Schedules GS/GM and GMH), and $0.035149/kWh (-3%) for Lighting customers (Rate Schedules AL and SE).

Weather

  • As we move into the second week of April, forecasts call for above-average temperatures along the coasts, especially in California and along the Southeast and Mid-Atlantic coasts, while average temperatures sit in the middle of the country, with higher chances of cooler than average temperatures in parts of Montana, Wyoming and South Dakota.

  • Above-average precipitation is expected throughout most of the continental US. A wide-reaching storm stretching from Mississippi to the southern Ohio Valley and the Carolinas will increase chances of abnormally high precipitation in most of the Southeast. California will likely see dryer than average conditions.


© 2019 by TRUELight Energy LLC

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