TPI Takeaway

TPI Market Snapshot header

WARMER TEMPERATURES COAST TO COAST WILL RESULT IN HIGHER DEMAND

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Despite the drop in Natural Gas which has historically been a massive driver of electricity prices, the cost of electricity continues to rise. This is primarily due to extreme temperatures and demand from coast to coast. This summer is predicted to be a Top-10 or even Top-5 hottest summer on record.

FREEPORT SHUTDOWN HAS SENT PRICES TUMBLING

FREEPORT COULD BE DOWN UNTIL THE END OF 2022

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  • The first sharp drop came in the 8th when the explosion happened at Freeport LNG Facility in Texas. Initial estimates were around three weeks before the plant was back in operation.
  • The second drop came on June 14th, when it was announced the facility could be shut down until the end of the year. This news has caused the market to drop almost $3.00 in the last ten days.
  • The shutdown will mean 2.0-2.6 Bcf/d will no longer be exported but will stay domestically. So that is roughly 14-15 Bcf/week. 

 NATURAL GAS STORAGE REPORT

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  • The market for Natural Gas has fallen by almost $3.00 in the last ten days due to the initial explosion at the Freeport LNG facility and then the announcement that the facility would be offline until late 2022.
  • Results for the 2023-2024 Capacity Auction will be released after 4:00 PM on Tuesday, June 21st. The current capacity cost is just $50.00, and many expect it will rise, but not significantly. The average auction price for capacity has been $118.00.
  • Next April is still the expected month for severe drop-offs in Natural Gas pricing outside of the current slide. The market goes from $6.03 to $4.83 from March to April. That is when heating demand is expected to drop next winter, hoping production will have caught up

 PJM BGE FORWARD POWER PRICING

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PJM ADHUB FORWARD POWER PRICING

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