Texas Power Prices Jump as Demand Rises Above Day-Ahead Forecast

Dec 27, 2013 4:55 pm ET

Dec. 27 (Bloomberg) -- Spot wholesale electricity prices in Texas rose as power demand exceeded expectations and wind generation fell below forecasts.

Power use on the Electric Reliability Council of Texas Inc. network, grid operator for most of the state, averaged 34,983 megawatts for the hour ended at 2 p.m. local time, an increase of 2.4 percent from the day-ahead forecast of 34,165 megawatts, according to the grid’s website.

Wind generation averaged 394 megawatts at 2 p.m., below the day-ahead forecast of 879 megawatts, the website showed.

Spot prices at the Texas North hub, which includes Dallas, advanced 4 percent to average $27.13 a megawatt-hour for the hour ended at 2 p.m. from the same time yesterday, grid data compiled by Bloomberg show. Houston hub prices rose 4 percent to average $27.31 a megawatt-hour.

North hub on-peak power traded 7 cents above the Houston hub, compared with a 50-cent premium yesterday and a three-month average discount of $1.17 for the North hub.

Prices in New York City jumped 49 percent to average $62.94 a megawatt-hour for the hour ended at 3 p.m. New York time from the same time yesterday, while Boston prices slid 36 percent to average $58.02 a megawatt-hour, the grid data show.

New York on-peak power traded $95.24 below Boston, compared with a $70.46 discount yesterday and a three-month average discount of $15.50 for New York.

Spot power at PJM Interconnection LLC’s benchmark Western hub, which includes Washington, fell 8.9 percent to average $27.25 a megawatt-hour at 3 p.m. Prices at the Eastern hub, which includes New Jersey, declined 15 percent to average $26.98. a megawatt-hour.

PJM West on-peak power traded $6.97 above the Eastern hub, compared with a $7.08 premium yesterday and a three-month average discount of $2 for PJM West.

In the Midwest, power at the Indiana hub, a regional benchmark, fell 13 percent to average $25.93 a megawatt-hour for the hour ended at 2 p.m. local time from the same time yesterday.

--Editors: Bill Banker, Charlotte Porter