U.S. Northwest wholesale power prices rose to record seasonal highs as a wave of heat boosted demand while low water levels limit hydroelectric generation.
A warming trend in the region will push temperatures near record levels for the time of year heading into the weekend, said WSI Corp., a weather services company. The water runoff at The Dalles Dam on the Columbia River in Oregon, the benchmark for the Northwest, will be 33 percent below normal from April through September, the Northwest River Forecast Center said in a report Tuesday.
Lower hydro supplies and stronger demand in response to higher temperatures is limiting Northwest power exports into California, which is experiencing a record drought, according to grid data and Genscape Inc.
“High prices seem to be due to the low hydro situation for this time of year combined with near record temperatures across the northwest,” said Ross Fessenden, a Boston-based analyst for Genscape Inc., which tracks real-time power data.
On-peak power for next-day delivery at the Mid-Columbia hub in southern Washington state near the Oregon border, jumped $10.75, or 19 percent, to $66.49 on the Intercontinental Exchange, the most since Feb. 24, 2014, and the highest for this time of the year in data going back to 2001.
Hydro generation from plants managed by the Bonneville Power Administration was 41 percent below the five-year average during the peak-demand hours in the two weeks ended June 23, Fessenden said. Overnight output was 56 percent lower than average for the period. On-peak hours are from 7 a.m. local time to 10 p.m.
The high temperature in Portland, Oregon, on Wednesday will be 85 degrees Fahrenheit (29 Celsius), 10 above normal, before jumping three days later to 95, said AccuWeather Inc. The reading in Los Angeles will reach 83 degrees Wednesday, 3 above average.
In California, high mid-Columbia prices “as well as above-average temperatures in the Southwest, lead to some of the lowest imports into the state we’ve seen at this time of year,” said Fessenden.
California power prices rose to the highest levels in more than six months. The NP15 hub in the northern part of the state, which serves San Francisco, climbed $4.26, or 10 percent, to $45.89 a megawatt-hour on ICE, the most since Dec. 2. Southern California’s SP15 hub, including Los Angeles, rose $1.21, or 2.8 percent, to $44.84, the most since Dec. 15.