Good Morning,
On the surface the northwest current weather forecast is relatively unchanged:
I say on the surface because Portland took a slightly bullish turn:
Not a big deal, unless that cold lingers and/or grows. Those PDX temps are slightly below normal temperatures and should bump NW loads by a gig or more offsetting the recent declines:
The renewable picture remains quite bullish with near zero wind in the northwest and seasonally low solar in California:
We know a good storm will add 3,000 aMW of wind energy to the Mid-C but that same “good storm” in Cally does just the opposite; solar falls 2-3 gigs which is partially offset by an increase wind energy. That good storm in the golden state is dumping a lot of rain turning El Nino into El Nino and the state into a muddy quagmire.
BC Hydro, after a few weeks of squatting on the sidelines, is selling hard into the Mid-C. After a year of hard selling in 2015 we are thinking regime change and pondering a change in our NI export algorithms.
This sustained level of exporting has never happened before and most likely will continue given a better water in 2016 than 2015. It’s a concern for us as we are finding our short-term is missing beyond 7 days; it is also a concern for anyone who is trying to forecast trade or hedge in the Mid-C.
Note the delta between the current forecast (black line) and the forecast from one or two weeks back – that is the issue that concerns me regarding our forecast for BOM through March. More on this later, but let’s talk about the DC. BPA updated its long-term yesterday and now has the line partially returning on the 20th to 595 aMW and fully returning on the 1st of Feb:
Someone asked about Q2 earlier in the week and my reply was that now is not the time to lay on the heavy wood (or flatten out your hedges). From past experience there will be plenty of time to put on the runoff trade, the problem today is you can’t know what that trade is. Will this be a dry year or wet year? When will the runoff start? How will the feds regulate the system? None of those questions can be answered today and until we move deeper into the water year they won’t be answered. For now the best you can do is play the weather forecast – when it’s dry buy a bit, when it’s wet sell a chunk; when it’s really cold buy a block or two and when it’s warm sell a few pieces.
Mike