Spot wholesale electricity tumbled from Boston to Houston as mild weather cut demand during what’s normally the hottest month of the year.
Electricity use today on the 13-state PJM Interconnection LLC network, the largest in the U.S., may reach its lowest daily peak in almost eight weeks, according to the grid’s data. Prices there dropped to the lowest since September.
This month will be the coolest July since 2009, as air from Canada that sent winter prices to all-time highs is now subduing costs during the season of peak demand for air conditioning, according to Commodity Weather Group LLC. Residential utility bills in New York will drop 4.8 percent from July 2013, and businesses will see a 10 percent decline, Consolidated Edison Inc. (ED) said.
“Right now we have ample low-cost supply available, mild conditions and no demand,” said Teri Viswanath, director of commodities strategy at BNP Paribas SA in New York. “We think prices are going to remain depressed.”
On-peak power at PJM’s benchmark Western hub, which includes Washington, was down $11.33, or 27 percent, to $30.17 a megawatt-hour at 4 p.m., heading toward the lowest full-day average since Sept. 23, according to grid data compiled by Bloomberg.
New York City prices slipped $15.72, or 34 percent, to $30.48, the lowest since May 23, while power at the hub serving Boston and Northeast Massachusetts slid $21.99, or 47 percent, to $24.66 at 4 p.m. In Texas, the Houston hub dropped $4.44, or 12 percent, to $32.58.
Typical New York residential costs this month will be $92.51, according to Con Edison, the city’s utility, which had earlier projected costs at $101.58.
“Certainly July bills are lower than anybody has expected,” said Michael Clendenin, a spokesman for Con Edison in New York. “We haven’t had any major heat waves so usage is down, the price of supply is down and demand isn’t as high.”
The high temperature in Washington today was forecast to be 79 degrees Fahrenheit (26 Celsius), 9 below normal, while New York was seen at 75, also 9 below the average high, according to AccuWeather Inc. in State College, Pennsylvania.
Only California has recorded notable heat so far this summer, Viswanath said.
Gas futures for August delivery rose 6.1 cents to settle at $3.808 today on the New York Mercantile Exchange after dropping to $3.723, the lowest intraday price since Nov. 22. The futures have dropped 10 percent this year. Power plants are the biggest users of gas.
The hottest week of the year is usually the third week of July nationwide, “so we are very close to the summer peak here and seeing all this anomalous cooling,” Matt Rogers, president of Commodity Weather in Bethesda, Maryland, said by e-mail.
Population-weighted cooling-degree days, a measure of electricity demand, totaled 656 as of the week ended July 24, the lowest for the period since 2009, according to data from the National Oceanic and Atmospheric Administration.
Consumption today at PJM, which serves more than 61 million people in the mid-Atlantic region and the Midwest, is forecast to peak at 101,758 megawatts, which would be the lowest level since June 6, grid data showed at 5:11 p.m.
Power use in Manhattan and its four neighboring boroughs was projected to reach 8,263 megawatts, the lowest daily maximum since July 18, according to New York Independent System Operator Inc. data.
“You have all units available and ready to dispatch to meet summer air conditioning load, which tends to peak in July and August, and the weather is coming in so very, very cool,” Viswanath said. “We think that the peak is now behind us.”
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