Boston Power Prices Rise as Cold Weather Boosts Heating DemandHarry R. Weber
Spot wholesale electricity in Boston more than doubled as cold weather pushed demand above forecasts while higher natural gas prices boosted generating costs.
Power use on the ISO New England Inc. network averaged 17,464 megawatts at 3:25 p.m., versus the day-ahead forecast of 17,370 megawatts, according to the grid’s website.
The high temperature today in Boston was projected to reach 38 degrees Fahrenheit (3 Celsius), 5 below normal, according to AccuWeather Inc. in State College, Pennsylvania.
Spot prices in Boston advanced $86.02 to average $153.45 a megawatt-hour for the hour ended at 3 p.m. from the same time yesterday, grid data compiled by Bloomberg show. New York City prices rose 2.3 percent to average $41.29.
“Beyond cold weather, the reason for strength in New England is that we have very high gas pricing this week,” Jesse Fitzmaurice, a Boston-based analyst at Genscape Inc., said in an electronic message. “These are the highest spot gas prices in the country.”
Natural gas futures rose to the highest price in more than six months today as cold weather boosted fuel use.
New York City on-peak power traded at a discount of $100.10 to Boston, compared with a $55.64 discount yesterday and a three-month average discount of 66 cents.
Snow rolling through some areas caused blackouts. Winter storm warnings and advisories stretched from eastern Tennessee to southeastern Massachusetts, according to the National Weather Service.
Spot prices at PJM Interconnection LLC’s benchmark Western hub, which includes Washington, declined 13 cents to average $36.94 a megawatt-hour at 3 p.m. from the same time yesterday. Eastern hub prices dropped 35 cents to average $39.26 a megawatt-hour.
PJM West on-peak power traded $2.46 below the eastern hub, compared with a $3.18 discount yesterday and a three-month average discount of $4.78.
Spot prices at the Texas North hub, which includes Dallas, fell 15 percent to average $31.70 a megawatt-hour for the hour ended at 2 p.m. local time after gains earlier in the day. Houston hub power also slid 15 percent to average $31.70, the grid data show.