Good Morning,
We pondered long and hard yesterday to decipher what our esteemed leader’s cryptic message meant, but it only dawned on us this morning, while running Ansergy dashboards, what he was trying to say. It was a code word to BPA to cut the damn flows out of the damn dams, duh:
Apparently, BPA didn’t get the updated codebook in real-time, so it took them a day to react to the Trader in Chief, and cut they did, slashing nearly 50,000 cfs. We concur with Trump’s brave and bold call, we too were virtually long the LL BOM, as we assume Donny and Erik were as well. COVEFE!
That evil market, with its Fake news and Lying Prices, decided to pummel the BOM:
Most notably at Mid-C where the HL puked out nearly $2.00 and the LL a buck – if you shorted the ON|OFF you didn’t care much, now it just makes the OFF look so tempting now that we know the Commander in Chief is watching it. COVEFE!
Demand
Be careful on hating BOM too much, weather in the south is heating back up. Phoenix is poised to realize above normals for most of the month and Vegas as well.
The SP|NP degree day spread is blowing out; where last week it was NP over, this week SP will be hot and NP not. Adjust your books accordingly.
Speaking of NOT, the Mid-C is a NOT. Just cool for the next several days and maybe trigger a touch of heating load; AC load is a thing of the past, at least for the time being. There is nothing in this forecast to warrant COVEFE, so if you’re playing it, chill out and hope BPA keeps Coulee’s discharge at 150kcfs.
Hydro
The River Forecast Center also received Trump’s late night post and knew exactly what he meant:
STP be damned, they cut their ten days like the loyal lapdogs they are. Remarkable, and makes one not give a hoot about temperatures, not when the govt can slash a gig of energy by the push of a button.
BPA has gone into intense refill mode:
BPA added 3.8 MAF in three weeks and has just 3.5 MAF to go, but snow is disappearing fast and we expect an even faster refill over the next few weeks, so does the RFC (see 10 day).
Three of the Side Flow indexes are at five-year highs, but with cooler weather and declining snow levels, these will all fall away over the coming week.
The Spokane and Deschutes are the only rivers which dropped in this dashboard; both are now at average flows for this time of year.
We like seeing several of the California rivers commence shaping their discharges, four of the eight in the above dashboard are aggressively doing just that, which is a sign that inflows are weakening.
We found another COVEFE at the Bonneville Powerhouse; note the surge in spill occurring while generation flows were cut – COVEFE!
TransGen
Flows are all out of Mid-C and aren’t cycling (except at NI) which shows how weak the market was.
Speaking of weak, ISO gas outages are continuing to fall; now ZP is down to Gramma’s Honda generator offline.
A few new units are off, and a few came back.
Conclusions
We’re faders and like what you hate, and it seems most of you hate the BOM. We like seeing the RFC cut flows in its ten days and we love seeing Phoenix post nearly a month of temp forecasts above normal.
- MidC
- Staying short the on|off
- NP
- selling the HL spread (SP over)
- Palo
- Long the On|Off