Volume 15, Issue 71 July 2, 2018
In this Issue
Spotlight on WGL Midstream
Editor's Note
Heat Wave
Energy Management
WGL Energy Issues Notice Regarding Peak Electricity Usage
Weather
Local Cooling Degree Days*
Our Wind Power Partners

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Editor's Note
Heat Wave
Weekly review for June 23 - 29, 2018

 

After this writing, we received additional information that the “5 CP” that PJM publishes and local distribution companies (LDCs) use for Peak Load Contribution must come from “non-holiday weekdays”. So, even if Saturday or Sunday end up among the five highest loads of the summer, they will not influence your capacity cost.

On Thursday, the U.S. Energy Information Administration (EIA) reported that working gas in storage as of Friday, June 22, 2018 was 2,074 BCF. This was an increase of 66 BCF from the previous week, lower than market expectations. Inventories are now 735 BCF lower than last year at this time and 504 BCF below the 5-year average.

This week, the NYMEX natural gas 12-month strip fell 0.7% while the PJM West Hub 12-month forward curve was up 1.3%. The power increase was dominated by the July 2018 contract which was up more than 7% on expectations of high heat through the beginning of the month.  

Friday marked the beginning of a heat wave in the Mid-Atlantic and Northeast regions of the U.S., with forecasts calling for temperatures in the 90s over a period of several days. This heat is expected to drive PJM system load to some of the highest values of the summer. The five days with the highest peaks for the summer will be used to determine a commercial customer’s Peak Load Contribution (and, thus, future Capacity Cost). Therefore, reducing consumption during these peak hours can significantly reduce future energy bills. 

On Thursday June 28, WGL Energy issued its second electricity reduction notice of the year (the first was for June 18).  We are recommending that commercial customers reduce their electricity consumption during the next several days, from June 29 to July 3 (3:00 p.m. to 6:00 p.m. on Friday, Saturday & Sunday and from 2:00 p.m. to 6:00 p.m. on Monday & Tuesday).

Monday and Tuesday have the highest probability of ending up as peak days for this summer. It is rare that a weekend would end up having one of the peak hours, but forecasts for Saturday and Sunday were both above levels that made the top 5 last year. It is impossible to know in advance exactly which of the five days & hours will end up as the highest five for the year, given the uncertainty in each day’s forecast and the even greater uncertainty around what the daily load volumes will be for the rest of the summer. In order to confidently catch all five of the peak days, we will usually  recommend curtailing electricity consumption during at least ten days each year.

Visit our website to view the current electricity reduction notice.

 
 
This past week's market information is provided as a courtesy to our customers and is not indicative of, nor should be relied upon, as representative of future transactions. 
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WGL Energy delivers a full spectrum of energy offerings, including electricity, natural gas, renewable energy, carbon reduction, distributed generation and energy efficiency provided by WGL Energy Services, Inc. and WGL Energy Systems, Inc.

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