Washington Gas Energy Services: A Washington Gas Affiliate Complany
Volume 12, Issue 18
We Know Energy
May 16, 2014 Energy Update
In this Issue
Editor's Note
Summer Is The Next Adventure
Natural Gas Fundamentals
Natural Gas Storage Update: Largest Injecion of The Season. Data Released May 15, 2014
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 Heating Degree Days*
Recent Features
Washington Gas Energy Services Acquires More Than 20,000 Electricity and Natural Gas Customers from Castlebridge Energy Group (November 1, 2013)


 



Washington Gas Energy Services to Offset Carbon Impact of Upcoming RETECH Conference (August 30, 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
Summer Is The Next Adventure
Week in Review for May 9 - May 15, 2014

For this seven day period, the average 12-month price for natural gas on the New York Mercantile Exchange (NYMEX) fell 2% closing at $0.445/therm, while the 12-month average price for peak power on the PJM  also fell 2%. 

While we enjoyed a small price decrease this week, all eyes are looking ahead to the upcoming summer where the combination of temperatures and natural gas storage levels will likely drive prices for the next  few months.

On the storage side, levels are 45% below the five-year average and operating at an eleven-year low according to the Energy Information Administration (EIA). The industry needs to erase this storage deficit in order to keep a lid on energy prices this summer. Low storage levels can lead to higher energy prices.

On the weather side, if  we have a hot summer and natural gas is directed to the power plants instead of the storage fields, it will be difficult to minimize this storage deficit. A hot summer is a bigger concern this year than in years past because more power plants are now turning to natural gas to fuel their turbines.

To illustrate this concern, consider that according to EIA, back in April 2012, "generation from natural gas fired plants was virtually equal to generation from coal fired plants with each providing 32% of total generation." In other words, with the power plant operators able switch between coal and natural gas to fuel their generators, they will likely fire the source that is most cost effective to run. If it is a hot summer and the gas fired plants are called upon to carry the load, the storage deficit may linger into the Fall and create some upward pressure on energy prices. Stay tuned. Summer is the wild card.

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