U.S. Power Climbs to 12-Month High on Blazing Summer Heatby
It’s finally getting hot and humid enough to liven up power prices on the largest U.S. grid.
Spot wholesale electricity on the 13-state network managed by PJM Interconnection LLC jumped. Demand soared to a new 2016 high as air conditioners were cranked up to fend off the heat. Temperatures in Washington reached 96 Fahrenheit (36 Celsius) at 2:52 p.m., surpassing the projected high of 94 for Thursday, according to Accuweather Inc.
“It’s just so hot and uncomfortable,” said Anne Williams, a Boston-based power analyst for Genscape Inc. “Air conditioning demand is expected to maintain pressure on energy costs and will drive up wholesale power prices in PJM.”
Spot wholesale power at PJM’s benchmark Western hub, including Washington, jumped 56 percent to $162.60 a megawatt-hour in the hour ended at 3 p.m. from a day earlier, according to data compiled by Bloomberg. Spot on-peak prices are up 30 percent so far Thursday to average $87.28 from the previous day’s full-day average, the most for any day since July 20 last year. On-peak hours are from 7 a.m. until 11 p.m.
Demand across the PJM grid, which serves more than 61 million people in the mid-Atlantic to the Midwest, jumped to 152,361 megawatts at 2:50 p.m., beating not only forecasts but also the previous high for this summer. Should electricity use stay around these levels, it would the highest peak demand for any day since 2013.