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| Wednesday Aug 13, 2025 | |
| Mother Nature’s outlook for the balance of August 2025 is starting to form how energy traders are looking at the natural gas landscape as the prompt month forward curve slipped down to $2.80 for Tuesday’s close. Figure 1 | ConUS CDD/HDD Forecast vs. Last Year and Normal – by 5-Day Period (AG2) The figure above illustrates how the 15-day temperature forecast (blue) is shaping up compared to the previous run (red dotted), last year for the same days (gold) and what is considered normal (downward trending gray line). What is clear is that the current heat will last through the weekend before we see a big shift lower and transitioning to the last 10 days of the month attracts modest temperatures spreading across the country. If this pattern holds and extends into the start ... » read more | |
| Tuesday Aug 12, 2025 | |
| Western Canada’s natural gas market continues to grapple with constrained takeaway capacity, which has intensified existing oversupply conditions. Two major pipelines carrying gas from Alberta and British Columbia are currently operating below normal limits. On the GTN system, Kingsgate capacity was cut in late July to 2.39 Bcf/d and further reduced to 2.14 Bcf/d on August 12, where it will remain for the rest of the month. Meanwhile, capacity at BC Spectra’s Station 14 dropped to 1.55 Bcf/d in late July and held until August 9, before edging up to 1.70 Bcf/d. These constraints limit the region’s ability to move gas to markets where demand is stronger. Figure 1 | NGI Cash Prices: AECO hub and West Coast Station 2, 2024-Present With abundant supply and limited demand ... » read more | |
| Monday Aug 11, 2025 | |
| Sometimes it feels as though the energy industry is headed in two directions. On the one hand, we have extensively reported on the renewable transition. The growth of renewable resources, increasingly cheap development costs of batteries and solar, and non-market incentives like net 0 goals have fundamentally changed the grid. On the other hand, massive bets on natural gas backed by an ever-growing infrastructure suggest an acceleration of the same old grid, based on dispatchable thermal. The truth is, it depends on where you look Figure 1 | SoCal Gas Demand vs Temperature, Weekdays, July-September Our first figure from one of our Daily Demand vs Temperature Figures, featured in our Natural Gas Enterprise Package, shows the relationship between gas demand and temperature in SoCal. 2023 ... » read more | |
| Friday Aug 8, 2025 | |
| In the WECC, most of the load is within states that have RPS targets. Excluded are Idaho, Montana, Wyoming, and Utah (which has a voluntary RPS target of 20% by 2025, and so far, the same voluntary 20% in all future years). The heavyweight, both by proportion of load and by aggressiveness of RPS target, is California – which targets 100% renewable by 2045. Figure 1 | States with RPS Targets As solar capacity increases to keep up with RPS targets, this drives down the midday prices. (Note that while RPS targets are increasing, load growth is also increasing. In other words, both the percent of generation that must be renewable is increasing, and the denominator is increasing, so we’d need a lot of solar to meet the RPS target. To see the impact of this load growth if ... » read more | |
| Thursday Aug 7, 2025 | |
| In California, this past July was defined by cool temperatures. On the coast, this was one of the coldest July months in the past few decades. In the mountains and interior, it was another scorcher. Composite temperatures remained at or below average for the entirety of the month, creating a pattern of anemic demand for CAISO. This was one of the highlighted topics for our latest Renewable Monthly, which touches on the key topics of note tied to renewables for the month in review in markets across the Lower 48 states. In addition to the weather-driven weakness in load showing up on the CAISO grid, thermal demand also took a hit from the strong wind and solar performances in play throughout the month. Putting the pieces together, there was a world of difference between ... » read more | |
| Wednesday Aug 6, 2025 | |
| Heat is working itself into Southern California and the Desert Southwest this week with the former displaying peak loads in the 38-39 GW range starting on Wednesday and lasting through Friday. The uptick in demand will stretch the system in a way that has not been seen all summer as the month of July delivered moderate temperatures throughout the regions mentioned. Figure 1 | CAISO Peak Demand Breakdown – Actual and Forecast The level mentioned is significant when looking at years past as the grid’s supply stack was limited when it came to flexible resources and the natural gas landscape had its issues around SoCal Gas transport and storage (Aliso Canyon). Two of the three elements mentioned have been resolved for the time being with the power sector grabbing onto the ... » read more | |
| Tuesday Aug 5, 2025 | |
| The summer is about halfway over, and so far, it has been a relatively calm one in SPP. Temperatures have mostly remained seasonally cool, particularly prior to July. The figure below shows cumulative cooling degree days (CDDs) in SPP for the months of May, June, and July from 2017 through the current year. As shown, May and June 2025 recorded significantly lower CDDs compared to previous years. In May, the nine-year average cumulative CDDs was 136.29, while May 2025 settled at just 57.4. In June, CDDs were 55 below the average for the past nine years. However, conditions shifted in July, with a noticeable stretch of warmer temperatures. As a result, July 2025 saw a cumulative CDD figure of 485.3, slightly above the long-term average. Figure 1 | SPP-South CDDs, 2017–Present As ... » read more | |
| Monday Aug 4, 2025 | |
| California has been quite mild throughout the month of July 2025, but things are about to change as the short-term weather models have daytime highs reaching into the upper 90’s in key demand areas while inland is showing triple digits. The Desert Southwest is adding warmer temperatures as well while the Pacific Northwest is modest during the first full week of the new month. The uptick in temperatures in the Golden State is elevating the peak power demand numbers with the middle of the week displaying values ranging between 38-39 GW. Figure 1 | CAISO Peak Demand Volume – Actual and Forecast Looking at the aggregate chart on the left of Figure 1, the temperature increase is driving up the peak load by 3-4 GW compared to the end of July. The graph to the right displays ... » read more | |
| Friday Aug 1, 2025 | |
| This week the New York Time’s ran an article titled “Countries Promise Trump to Buy U.S. Gas, and Leave the Details for Later” while the Wall Street Journal says “Trump’s $750 Billion Deal for U.S. Energy Collides With Market Reality.” The European Commission has published a succinct and informative piece about the deal titled “EU-US trade deal explained - energy aspects.” One can understand why the average person might either (a) think this represents a bonanza for U.S. oil and gas business or (b) be very confused. Before rehashing some of the numbers (which don’t appear to add up), let’s first look at this through an energy trading lens. There are three things that lead to a purchase or sale of a commodity: (1) supply, (2) ... » read more | |
| Thursday Jul 31, 2025 | |
| One of the key stories this past week has been the blast of heat that originated in the Midwest and moved its way eastward to the coast, where it sat and intensified over the past three days. Yesterday, our daily blog focused on how MISO performed in the midst of the intense heat, with forced outages and real-time prices spiking to over $1,500/MWh on Monday night. As the week progressed, more of the heat made its way out of North MISO territory and over into PJM. This has been a recurring weather pattern in the Northeast throughout the spring and summer, with heat waves starting in the Midwest and moving into and across PJM shortly thereafter. We can see the movement across PJM in the load breakout by zone for the ISO (pictured in the figure below). The far ... » read more | |