Power prices experience overall decreases. Natural gas spot prices were mixed. North Carolina coalition petitions for competitive energy. More arctic air is expected across the Midwest, with an active storm forming in the western Gulf of Mexico and moving northeast.
The March 2019 NYMEX contract price decreased $0.09 (-3.3%) from $2.662/MMBtu to $2.575/MMBtu last Wednesday. The 12-month strip price averaging March 2019 through February 2020 futures contracts decreased $0.02/MMBtu (-0.1%) to $2.812/MMBtu.
Last week began with unseasonably warm temperatures for the Northeast and finished with temperatures dipping back down into average February cold. Boston’s Algonquin Citygate increased $1.06 (39.4%) to $3.75/MMBtu on Wednesday, February 13. Transco Zone 6 NYC prices increased $0.18 (7.3%) to $2.65/MMBtu.
Pennsylvania’s Dominion South rose $0.06 (2.5%) to $2.42/MMBtu. Tennessee Zone 4 Marcellus spot prices also rose $0.06 (2.5%) to $2.43/MMBtu.
Southern California prices have eased back down since last report’s price run up due to SoCalGas supply constraints. SoCal Citygate prices fell $9.61 (-47.3%) to $10.73/MMBtu. Prices at Northern California PG&E Citygate decreased $1.89 (-16.8%) to $9.34/MMBtu.
For the NEMASSBOST zone in ISONE, the 12 Month ATC strip decreased $1.13 (-2.6%) to $42.10. The 24 Month ATC strip dropped $0.71 (-1.6%) to $43.43, and the Cal 2020 ATC strip decreased $0.24 (-0.5%) to $44.76/MWh yesterday.
For the NYC zone in NYISO, the 12 Month ATC strip decreased $1.34 (-3.29%) to $39.45. The 24 Month ATC strip dropped $0.64 (-1.6%) to $40.55 and the Cal 2020 ATC strip decreased $0.06 (-0.1%) to $41.42/MWh yesterday.
For the PEPCO zone in PJM, the 12 Month ATC strip decreased $0.71 (-1.9%) to $37.53. The 24 Month ATC strip decreased $0.34 (-0.9%) to $37.74 and the Cal 2020 ATC strip increased $0.07 (0.2%) to $38.07/MWh yesterday.
For the Houston zone in ERCOT, the 12 Month ATC strip decreased $0.92 (-2.1%) to $43.01. The 24 Month ATC strip decreased $0.61 (-1.45%) to $41.58, and the Cal 2020 ATC strip decreased $0.40 (-1.0%) to $40.23/MWh yesterday.
The current Price to Compare (PTC) for Connecticut Light & Power (CLP), now Eversource, Residential Non-Heating rate class (Rate 1) is $0.10143/kWh, effective January 1, 2019 through June 30, 2019. This is an 18.9% increase from the previous PTC of $0.0853/kWh for July 1, 2018 to December 31, 2018.
TrueLight Energy’s expert pricing models indicate slight headroom of $0.00478/kWh for the 6 month term and $0.00529/kWh for the 9 month term. 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 CLP ATC 12-month strip has experienced a slight decrease, falling 2.6% to finish at $41.55/MWh yesterday.
In the past 3 months, the ATC strip has reached a high of $58.43/MWh on November 20, 2018 and a low of $41.50/MWh this past Friday, February 15, 2019. This time last year, the strip traded at around $38.17/MWh, about 9% lower than this year.
For the week ending February 8, the EIA reported net withdrawals from storage of 78 Bcf, which is lower than last year’s net withdrawals of 183 Bcf for this week and the 5-year (2014–18) average net withdrawals of 160 Bcf.
Working natural gas in storage totaled 1,882 Bcf, which is 30 Bcf (-1.6%) lower than last year’s level and 333 Bcf (-15%) lower than the five year average of 2,215 Bcf. Total working gas is back within the five-year historical range.
Supply & Demand
Average total supply of natural gas remained the same as in the previous report week, averaging 92.6 Bcf/day. Dry natural gas production remained constant week over week, while net imports from Canada decreased by 4%.
Total US consumption of natural gas rose by 6%. Consumption for power generation climbed by 11% week/week, industrial sector consumption rose by 2%, residential-commercial consumption increased 4%, and exports to Mexico increased 6%.
US LNG exports increased week/week, with six vessels departing US ports for a combined 21.3 Bcf.
A coalition of 15 local, state, and national groups have banded together in a call for competitive energy options in North Carolina. The group, called Energy Justice NC: End the Duke Monopoly, has formed a petition known as "Petition for Energy Choice in North Carolina," urging officials to pursue legislation that would open North Carolina up to competitive energy markets. Supporters highlight the benefits of consumer choice, such as more jobs and an end to the ‘broken nature’ of Duke’s monopoly over the NC power grid (as stated in the petition). The coalition has not yet made it clear whether the proposition is for retail electric choice (LSE choice) specifically.
Connecticut Light & Power (Eversource) has filed new Last Resort Service rates (Rates 39, 41, 55, 56, 57, & 58 - at or over 500 kW) for the April 1, 2019 to June 30, 2019 price period. The new LRS rates, which include a bypassable Federally Mandated Congestion Charge of -$0.00010/kWh, are $0.08954/kWh for April, $0.07742/kWh for May, and $0.07325/kWh for June.
Reciprocating internal combustion engines, which are smaller than other kinds of natural-gas fired electricity generators and typically used as backup emergency power, are increasing in popularity for larger utility-scale generation. This is especially true for areas where intermittent energy sources like wind and solar are prominent. The reciprocating engines are being used to balance out these intermittent sources due to their quick start and stop capabilities as well as the ability to operate at partial loads. The largest of these facilities, the Dentin Energy Center near Dallas, Texas, has twelve 18.8 MW natural gas-fired reciprocating engines and came online in late July 2018.
More arctic air is taking hold of the Midwest and dipping into Texas, with highs in the single and teen digits expected for much of the Midwest. Winter storm warnings are in place across the southern Rockies, with potential for over a foot of snowfall in higher elevations. Snow and freezing rain are expected for the central Appalachians and northern Mid-Atlantic for late Tuesday into Wednesday.
An active storm system has developed in the western Gulf of Mexico and has pushed up into Texas and parts of the East Coast earlier this week. Moisture pushing northwards will result in heavy rainfall for Louisiana and Kentucky, with 2 to 4 inches of widespread rainfall likely. Strong thunderstorms are also probable across some areas of the Deep South.