Washington Gas Energy Services: A Washington Gas Affiliate Complany
Volume 11, Issue 26
We Know Energy
June 28, 2013 Energy Update
In this Issue
Editor's Note
Weather Rules
Natural Gas Fundamentals
Natural Gas Storage: Another Big Injection. Data Released June 27, 2013
Rig Count for Natural Gas
NYMEX Natural Gas Monthly Settlements for the Past 12 Months
NYMEX Values per Month for the Forward 12 Months
NYMEX Graph for Natural Gas - 12 Month Average Price per Therm at the Louisiana Well-Head
PJM Electricity
PJM Graph for Electricity - 12 Month Average Peak Power Price
Weather
Local Cooling Degree Days*
Recent Features
WGES Selected to Provide Groundswell 100 Percent Wind Power for its Community Power Program Bid (May 24, 2013)


 


WGES Presents $88,000 to Chesapeake Bay Foundation at Annual Earth Day Tree Planting (April 26, 2013)


 


Washington, D.C.’s Union Station Now Powered by 100 Percent Wind Energy Provided by WGES (April 12, 2013)


 


New Contract with WGES Helps D.C. Retain Position as the Nation’s #1 Green Power Community (March 8, 2013)


 


WGES and Sterling Planet Renew Unique Partnership and CleanSteps® Carbon Offsets Agreement (March 1, 2013)


 


Our Wind Power Partners
Green Power Leadership Award Winner - U.S. Department of Energy


Visit wges.com/partners for full list of WGES Wind Power Partners.

 
To find out more about a green power purchase for your organization, call 703-793-7578, or visit wges.com/commercialwind.

For more information, contact your WGES Account Manager or wges_lgc@wges.com.
Editor's Note
Weather Rules
Week in Review for June 21-27, 2013

Although natural gas and electricity prices were relatively flat during the prior two-week period of June 6 through June 20, the bears made a run this week. For this seven-day report period, the average 12-month price for natural gas on the New York Mercantile Exchange (NYMEX) fell 6%. The 12-month average price for peak power on the PJM fell 4%.

The two variables credited for this week's price drop were storage and weather.

On the natural gas storage side, this week's injection was 95 Bcf. Last year at this time we saw an injection of 58 Bcf. Thanks to a recent run of larger-than-normal injections, the storage deficit has continued to shrink. We are now only 1.2% below the five-year average. The larger-than-expected injection placed downward pressure on energy prices.

On the weather front, the National Oceanic and Atmospheric Administration's 6-10 day outlook for July 3-7, 2013, called for cooler-than-normal temperatures east of the Mississippi. Cool weather means more natural gas is available for injection into the storage fields. Large injections reduce the storage deficits and tend to place downward pressure on energy prices.

Do not be lulled to sleep however. Summer has just started and hot weather is on the menu. The reason that hot weather impacts energy prices is because more and more power plants are consuming natural gas to meet the country's air conditioning needs.

According to the Energy Information Administration (EIA), "the consumption of natural gas by electric power generators has been increasing each year since 2009 as lower natural gas prices allowed natural gas fired generators to compete with coal fired generators."

For the period of 1990-2010, coal fired generators produced approximately 50% of the country's mid-summer electricity. During the peak summer months of 2012, coal produced only 39% of the country's electricity. The facts indicate that natural gas demand at the power plants is increasing. This means a hotter-than-normal summer can impact energy prices more than ever before.

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