Eye of the Hurricane

Posted on by William Griswold

Good Morning,

Temperature forecasts in the south have grown warmer over the weekend while the Northwest has slightly cooled. Palo and SP loads will be strong for most of this week while the Northwest won’t, but America’s icebox will also not kick off its WY17 runoff, either.

Demand

Phoenix should set its CY17 high this week, at 97, all of which arrives with a nuke out for refueling and probably a few coal plants racing to get back from Winter maintenance. Even Denver joins the party, that sunshine-drenched city will bask in the 80s which put an exclamation mark to the end of Colorado’s heating season.

We’ll see a spike into the high 80s in the LA basin this week, but that doesn’t approach the 90s we saw a few weeks back. The rest of the state is just mild, San Diego in the mid-70s, everywhere in the mid-70s, except the deserts, they are hot like they usually are.

The producing region has a slight warm-up this week then the 10-24 day outlook is just cold, averaging 5 degrees below normal. Even normal isn’t enough to trigger the “runoff” and with all of the low-elevation snow now working its way towards Guam, the rivers are backing off, it’s the head fake bullish period – kind of like being in the eye of the hurricane. The front winds hit us in Feb-March, that was the melting of the low-level snow, now we are in the eye caused by just normal temperatures, and soon we will be back into the tempest, but not for weeks given this weather outlook.

California hasn’t seen its runoff-induced surge, either, not with Lake Tahoe still posting below freezing temperatures at night. Seattle hit a winter high of 66 yesterday while Kalispell, and Spokane, remain below freezing in the evenings.

Hydro

It’s really about the runoff, when will it start, how high will it crest, and how many days will it last. That is the main show, the sideshow is the draft for flood control, and that flick has become a yawner. Coulee is now at 1233, 11′ to go in thirteen days. Reaching that target won’t be a problem given those coolish temperatures above Lake Roosevelt.

This isn’t a real wet forecast, except for Kalispell, MT, which is projected to enjoy 1.6″ of cumulative rain over the next ten days which is about twice what she normally receives. All of that will come as snow north of 5000′; the water year will build during those ten days when normally it decays pushing the event deeper into May, or more likely June. Bear in mind that the trend is your friend, sometimes, and the Northwest weather trend is cold. Cold is bullish for May – decent loads and a dearth of melt; on top of all of that, the cherry on the sundae, is the opportunity for BPA to begin refilling reservoirs. So where April is drafting 30-40kcfs of water per hour, May will be injecting 30-40kcfs of water per hour.

California is dry, much to the Golden State’s relief. All that remains of this epoch water year is that epoch mountain of snow on those epically beautiful Sierra Nevadas.

It seems CDWR is evacuating water out of Shasta in anticipation of that epic melt; flows have doubled to 25kcfs. Most of the other projects are off, the freezing temperatures up high have put a brake on the melt.

Similar story for Northwest rivers, these are mostly off – except for the Pend Oreille which is regulated by the lake with the same name. Look at the decay on the Clark Fork (which feeds into Lk PDO), and the Spokane, and …every other river. Look at Side flows, too:

Every index is off, natural river flows are falling, as are reservoir elevations – the calm before the storm, the eye of the hurricane – head fake. Tally Ho, Off the Cliff we Go!

BPA’s 140kcfs experiment at Coulee has ended, flows through the turbines are back to 180 kcfs, and flows at BON are up while the spill is down. We suspect the dissolved gas issue has forced BPA to curb its creative Optional Spill program.

The above is a plot of hourly flows through Coulee’s turbines (QG). We wanted to highlight the swings at 180kcfs, something we didn’t see the first two weeks of April. So though the overall discharge is back up, there is some shaping going on. BPA’s way of sighing in relief,  the mother of all grid operators can now exercise some flexibility. The castration of Coulee is ending. That big beast is growing a new set of shaping balls, and come May, those gonads will have dropped.

TransGen

Gas outages in SP remain strong.

Just a few units returned to service over the weekend;

While a few big boys went AWOL.

Palo noms remain the most bullish of the hubs and NP’s are the most bearish. MidC gas noms have come back to life; we might expect them to rally further as the draft abates, if the Northwest doesn’t’ warm up soon.

Meanwhile, the hub is filling its lines southbound, and the Canadians are taking a pause all of which should have made for a nice weekend real-time market. Flows out of ZP are mostly sideways, we expect Path 26 to fill to serve LA’s heat.

Conclusions;

The market paused to catch its breath on Friday, gas is off today on the open, but the fundy’s in the south look better today than Friday, too bad the price is so high.

  • MidC -the pain of being short is over, today’s price solved that.
    • HL – short
    • LL – long off of BPA’s ability to start shaping
  • SP15 – it’s warming up, loads will spike
    • HL – long
    • LL – long
  • Palo – can’t really short it in front of perhaps the first 100-degree day of the year
    • HL – long
    • LL – short, probably done too much rally

The NP|SP LL spread is at a contract low; we’ll fade that. So is the SP|PV LL, now trading -3 (yet energy is still flowing into the ISO) -we’ll fade that too.

Long both the SP & PV HL & LL rolls; all four are at contract lows. May will be warmer than April, and warmer than the next 13 days of April. The rivers in CA won’t be any fuller than they are today; if anything they might be lower.

The BOM on|off hysteria is ending, turns out that selling spread has been as good as buying it was a month ago.