Hydro generation decreases cause electricity prices to rise

Aug. 15, 2002 — Wholesale electricity spot prices have been increasing over the past several days at the major western U.S. trading centers due to a decrease in hydrogeneration in the northwest and generally warmer weather, the Energy Information Agency reported Tuesday.

Prices at the Mid-Columbia trading zone have increased 49% from a low of $14.09 per megawatthour on August 8 to $21.02 per megawatthour on August 12.

According to the Bloomberg Power Lines Report, the Bonneville Power Administration, which makes its surplus hydroelectric supply available to the wholesale market, lowered its peak offering from 800 megawatts to 600 megawatts.

At the Four Corners trading center in the desert southwest, prices have increased 30% from $28.92 per megawatthour on August 8 to $37.66 per megawatthour on August 12.

Recent prices in the Mid-continent region have increased as warmer weather has returned and the demand for electricity has increased. Prices at the Cinergy hub increased 68% to $35.92 per megawatthour from last week’s low of $21.33 on August 7.

Prices at each of the three trading centers in the Northeast have gone up substantially over the past several days as warmer weather has moved into the region spurring an increase in the demand for electricity. The largest percentage increase occurred at the PJM hub, where prices increased 149% from $27.44 per megawatthour on August 7 to $68.65 per megawatthour on August 12.

Similarly, prices in New England jumped 128% from $33.20 per megawatthour on August 7 to $75.63 per megawatthour on August 12. Prices at the New York Zone J, New York City went up 91% from $55.50 on August 8 to $106.00 per megawatthour on August 12.

Over the past seven weekdays, the average price at all trading centers has ranged between $29.05 per megawatthour and $48.24 per megawatthour.

There are charts available at http://www.eia.doe.gov/emeu/security/esar/latel.html.


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