Alberta’s weighted average Power Pool price for December is currently $39.86/MWh. Prices have come back down this week, reducing slightly by $1.25/MWh or 3%. The only price volatility occurred on December 21st between 2-4pm MST, when the Power Pool Price peaked at $129.82/MWh, before dropping slightly to $107.42/MWh. Prices remained elevated relative to the monthly average for the subsequent 3-hour period, hovering around the $60/MWh mark. Demand in the province remained relatively flat week-over-week, decreasing by 30MW or 0.3%, and there was only one notable generator outage; Battle River 5, a 385MW generator, which has been offline since December 22nd.
The weighted average Hourly Ontario Energy Price (HOEP) is currently at 1.8¢/kWh for December, a slight increase of 6% or 0.1¢/kWh from last week’s values. Although demand and supply both increased 2% relative to average December levels (16,132MW and 16,768MW respectively), the supply of expensive natural gas increased 30% (1,663MW), driving the small uptick in price. Currently, with the first Global Adjustment estimated at 10.7¢/kWh, December’s total market price is 12.5¢/kWh.
In other electricity news, the Independent Electricity System Operator (IESO) recently completed its annual demand response auction. These auctions are an important tool in acquiring additional capacity for the province. This year was the first time the IESO invited electricity-generating resources to compete, where previously only load-side resources participated. The auction secured 992.1MW of capacity with a final clearing price of $197.58/MW-day, a 26% reduction from last year’s price. Auction participants have committed to provide capacity for summer 2021. The IESO’s next capacity auction is scheduled for December 2021, where they intend to open the auction to more resource types. Opening the capacity auction to new participants is part of the IESO’s 2021-2024 Conservation and Demand Management (CDM) framework, which will launch the week of January 4th, 2021, replacing the current interim framework. The new CDM framework will focus on cost-effective measures to meet Ontario’s electricity needs, including reducing peak demand, maintaining system capacity, and seeking customer-based solutions.
Also starting in the New Year are new COVID-19 rate relief prices for residential, small business, and farm customers who pay Regulated Price Plan (RPP) rates. The newly announced flat rate of 8.5¢/kWh for Time-of-Use and Tiered pricing will be in effect from January 1st–28th, 2021, for the duration of the province’s lockdown starting Boxing Day. Also starting New Year’s Day is the revised Ontario Electricity Rebate (OER) of 21.2% from eligible customers’ pre-tax subtotal.
– Mark Ljuckanov, Energy Data Analyst / Ryan Cosgrove, Energy Data Analyst
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