Commodity market report
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8 Pages

North America power markets short-term outlook March 2016


North America power markets short-term outlook March 2016

Report summary

General economic growth continues to provide support to our power demand forecast overall. However, we do see some downward revisions to forecasted loads in this outlook, as losses to industrial demand have now begun to pull our forecasts down in some markets. Overall, despite a further decline in natural gas prices in this outlook, the revised load forecasts and additional contracted coal in 2016 and 2017 limit gains for natural gas.  In particular, the concentration of industrial load impacts in the Midwest and the associated reduction in the demand forecast resulted in the biggest decline in gas generation balances in this update. The Southeast region saw the most relative strength; however, forecasted prices came down in every other region. ERCOT continues to price lowest across most markets on average. In the WECC, March weather support boosts our near term hydro outlook, while impacts from demand losses in Washington cascade across the western US.

What's included?

This report includes 2 file(s)

  • North America power markets short-term outlook March 2016 PDF - 370.73 KB 8 Pages, 1 Tables, 4 Figures
  • NAPS STO STV 3 31 2016.xls XLS - 26.51 MB

Description

The power sector is rapidly transitioning to a cleaner generation mix supported by technological and regulatory changes. Regional markets and structures are adjusting to these new realities with implications on fuel demand, commodity pricing and asset values.

This Power Markets Short Term Outlook report provides a detailed analysis of supply, demand and price fundamentals, as well as the regulatory and market issues affecting regional power markets.

Use this report to examine key issues driving regulatory and economic trends and identify future growth opportunities in regional power markets.

Wood Mackenzie's detailed analysis and reliable market forecasts give you a strong foundation for your investment decisions and corporate planning. Our experienced power research analysts use high-quality proprietary gas, coal and oil markets research to help you unlock power market fundamentals and identify future growth opportunities.

  • Executive summary
  • Fundamentals
    • Natural gas prices look to stabilize after warm winter despite the onset of seasonally weak spring demand
      • Coal and natural gas inventories remain bloated
      • How much could US production fall this summer?
  • Generation balances and prices
    • Fundamentals feel pain from both demand and fuel price impacts
      • Industrial losses begin to offset overall economic gains for power demand
      • Supply: East to see some incremental new solar come online in 2017
      • Industrial losses impact regional generation balances
    • Prices take another leg down although spark spreads improve in some markets
    • WECC
  • Scenario Overview
    • Figure 6: North American power generation balances and fuel prices

In this report there are 5 tables or charts, including:

  • Executive summary
  • Fundamentals
  • Generation balances and prices
    • Figure 1: Changes in Eastern power market fundamentals (Relative to February 2016 STO)
    • Figure 2: Relative changes in Eastern markets’ power price metrics (Relative to February 2016 STO)
    • Figure 3: Changes in WECC power market fundamentals (Relative to February 2016 STO)
    • Figure 4: Relative changes in WECC markets’ power price metrics (Relative to February 2016 STO)
  • Scenario Overview
    • Scenario Overview: Table 1
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