Updated Aug 22, 2024
8/22/24
Weather forecasts that called for a sweltering August in California supported baseload natural gas prices in the region on the third day of bidweek trading (July 29), NGI’s Bidweek Alert (BWA) showed.
Price spikes that plagued natural gas delivered to hubs across California and the Southwest in past summers are unlikely to repeat, even in the face of extreme heat, according to experts.
Natural gas aided electric grid operators in California and Texas in maintaining stable operations as solar generation dropped during Saturday’s annular eclipse.
Sunny California will see its skies darken for about three hours in mid-October by a rare annular eclipse, and officials now are working overtime with regional authorities, as well as natural gas interstate and intrastate suppliers, to ensure there are adequate resources available to make up for the expected solar shortfall.
The California Independent System Operator (CAISO) board has set a $7.3 billion plan in motion to advance the state’s energy transition and prepare the grid.
Electric grid operators said they are ready to meet power consumption this summer except in extreme circumstances, with natural gas-fired generation comprising the lion’s share of the sources expected to handle the peak loads.
Natural gas futures fizzled midweek but held comfortably above $9 as bulls remained largely in control of the market. The September Nymex gas futures contract settled Wednesday at $9.244/MMBtu, off 8.5 cents day/day. October futures slid 8.3 cents to $9.228.
The California Public Utilities Commission (CPUC) on Thursday approved a series of actions to reduce the risk of power outages during extreme heat events, including possible increased natural gas-fired generation from existing plants.
PJM Interconnection, the largest U.S. power grid operator, is forecasting adequate supply to meet the electricity needs of its 65 million customers this summer.
FERC has authorized the California grid operator to make permanent its four-year-old natural gas maximum burn constraint to avoid future shortages from continuing limits on the state’s largest gas storage facility at Aliso Canyon.