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Energy Market Update: January 23, 2019

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This is it: winter. We’re right in the thick of it. And with a while to go still, the weather will likely affect the price of electricity moving forward. So where do electricity prices stand across the country, and which risk premiums should we keep an eye on?

Join Direct Energy Business Strategist Tim Bigler for a market-by-market look:

Around-The-Clock Regional Energy Prices, 2020

New England

This region is experiencing some relief in prices, as risk premiums have been taken out of both the gas and electric markets. However: today’s prices are still quite elevated compared to where they were two years ago (even taking into account the recent price drop).


Cold weather in New York City has introduced a risk premium into prices in this region, which have seen an increase recently. The good news is that prices remain in the same range we’ve seen over the last two years.

CAISO SP15 (SoCal)

Prices here are dropping somewhat, partly thanks to the influence of hydroelectric power. However, similar to New England, prices are quite high relative to what consumers were paying April or May of 2018, when prices spiked. One reason for the spike at that time was the onset of an especially hot summer combined with gas pipeline issues. These factors continue to keep prices elevated from a big-picture standpoint.

PJM West Hub

Prices in this region continue to climb thanks to the influence of high natural gas prices.


Coal plant retirements are driving electricity prices higher and higher in Texas. The grid’s single-digit reserve margins are also having an effect, and prices for 2020 actually hit a new high this month after running at an already-elevated rate for most of 2018.


NYISO has announced new modeling for Zone A, which (as a risk premium) is fueling a price spike in the region. Furthermore, a lack of liquidity in this region continues to drive prices higher than at any other point in the last two years. (And don’t forget that natural gas supply is also an influential factor in this region.)


Prices here are steady because natural gas and coal have remained stable price-wise in the region. PJM ComEd has the highest coal concentration of any region that we examined today, so it should come as no surprise that it is currently the most consumer-friendly region, too.

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Posted: January 23, 2019