What's with electricity prices? - Democratic Underground

Massacure

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Tue Dec-13-05 04:45 PM
Original message

What's with electricity prices?

http://www.bloomberg.com/energy/

Mid-Columbia, firm on-peak, spot 133.59
Palo Verde, firm on-peak, spot 113.79
Bloomberg, firm on-peak, day ahead spot/West Coast 137.13

It seems like they were all $80-90 per MWh just last week. Whats with the sudden jump?

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rkc3

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Tue Dec-13-05 04:49 PM
Response to Original message

1. Are these for industrial users?

Usually, industrial users get charged for power based on when they use the power. I believe households are charged a flat rate.

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mongo

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Tue Dec-13-05 04:52 PM
Response to Reply #1

2. I believe that is the wholesale price of electricity

If you don't produce enough power to serve all of your customers, you either buy it in advance under contract from another company or buy it at spot rates when you need it.

The price fluctuates due to demand/power plant outages.

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Warpy

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Tue Dec-13-05 05:05 PM
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3. The spike in natural gas prices is likely to blame

The spot market is going nuts right now after that blast of arctic air that covered much of the country.

You're seeing what's happening to all those gas fired turbines when they have to pay double for gas.

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orwell

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Tue Dec-13-05 05:06 PM
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4. Natural Gas Prices

An awful lot of electricity is gereratred from natural gas. Nat Gas prices are the highest they have ever been.

That is probably the cause.

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Massacure

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Tue Dec-13-05 05:17 PM
Response to Reply #4

5. Makes sense. These prices are for peak demand.

Peak demand plants are usually natural gas. Coal and nuclear are usually base load.

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NNadir

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Wed Dec-14-05 01:32 PM
Response to Reply #4

6. The days of knee-jerk decisions to build natural gas generators are

probably over.

This was predictable. To the extent that this capacity is not replaced by coal, it may be a good thing overall.

If humanity survives global climate change, these plants could be useful for peak load purposes if fueled by synthetic gas made from carbon dioxide or by biogenic gas.

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Dogmudgeon

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Wed Dec-14-05 02:09 PM
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7. One big reason

December has been unusually cold across North America. New York and Philly alone have each had a couple of days with temperatures 20F below the norm.

Besides, we're in a Peak-Plateau situation with respect to energy supplies. Such a situation has long been predicted to amplify the natural ripples in the marketplace. Some of it is price gouging and market-gaming, but I'm sure a lot of it is based on a reduced sense of reliability of energy supplies. Markets tend to be emotional, easily-spooked beasts.

--p!

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