Northern California Power Premium Widens as Gas Plant Shuts

Northern California spot wholesale electricity is trading at a record premium for this time of year to the southern half of the state after a gas-fired plant was shut, contributing to transmission bottlenecks.

Calpine Corp. took its 857-megawatt Delta Energy Center, about 41 miles (66 kilometers) northeast of San Francisco, off the grid early today, according to Genscape Inc. Output from Southern California’s wind turbines is above forecasts. The 5,400-megawatt PATH 15 transmission line, which has been operating at about half its capacity since October, is limiting power flow between the regions.

Spot power Northern California’s NP15 hub rose $5.76, or 18 percent, to $37.38 a megawatt-hour from a day earlier in the hour ended at 1 p.m. local time, grid data compiled by Bloomberg show. The on-peak average so far today is $25.97 a megawatt-hour, a $5.79 premium to Southern California’s SP15 hub. NP15 is trading at the biggest premium for this time of the year since at least 2009, when the state power market was redesigned.

“NP is currently above SP due to very strong wind generation in the south, and a decrease in generation in the north with the Delta Energy Center out of the stack for today,” said Chris DaCosta, a Boston-based analyst with Genscape, which tracks real-time power data. The reason the Delta dropped out of the supply mix “is due to economics,” he said.

Calpine did not immediately response to an email requesting a comment.

California Wind

Wind generation in Southern California was 1,695 megawatts for the hour ended at noon local time, 20 percent higher than yesterday’s day-ahead forecast of 1,416 megawatts for the hour, according to the California Independent System Operator Inc.’s web site. Power consumption was running above forecasts across the state, the grid operator said.

Spot power declined from Maine to Texas and North Dakota as demand fell below forecasts. Temperatures today will be below normal in cities including Dallas, Chicago and Boston after unusually hot weather yesterday, according to AccuWeather Inc. in State College, Pennsylvania.

PJM Interconnection LLC’s Eastern hub, which includes prices from New Jersey to Virginia, dropped $24.08, or 31 percent, to $54.88 a megawatt-hour for the hour ended at 4 p.m. New York time. The Electric Reliability Council of Texas Inc.’s North hub, which includes Dallas, fell $14.20, or 31 percent, to $32.24 a megawatt-hour.

Midwest Power

Prices in the Midwest’s Illinois hub slid $2.83, or 6.9 percent, to $38.13 for the hour ended at 2 p.m. local time.

U.S. electricity demand peaks in the summer, when hot weather drives the need for air conditioning.

Demand across the 13-state grid operated by PJM, from New Jersey to North Carolina and Illinois, was 107,507 megawatts at 4:05 p.m., 6.2 percent lower the day-ahead forecast, according PJM’s website. Texas power consumption was 53,102 megawatts at 3:19 p.m. local time, 8 percent below yesterday’s forecast, according to Ercot’s website.

Boston power extended losses as demand dropped below the forecasts. Prices fell $7.63, or 19 percent, to $33.35 a megawatt-hour in the hour ended 4 p.m. from the same time yesterday.

The New York Independent System Operator Inc. said that the state grid was operating under a thunderstorm alert as of 3 p.m. Spot New York City power jumped $44.44, or 96 percent, to $90.81 a megawatt-hour at 4 p.m.

Prices reversed earlier declines caused by a slump in demand as the amount of electricity imported from Canada and PJM declined, according to the grid’s website.

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