Alberta’s weighted average Power Pool price for February is currently $196.64/MWh. After a mild start to the month, the recent cold snap sweeping the province has caused havoc on demand and hourly pricing. Hourly demand during the first days of the month averaged 10,588MW, whereas it averaged 357MW or 3.4% more during the subsequent week. Over the past week, we have experienced daily price volatility beginning early in the morning, at 7am MST, and continuing throughout most of the day, typically lasting into the evening between 7-8pm MST. Temperatures have hovered around -20°C to -25°C, with parts of the province reaching as low as -45°C. As a direct result, hourly prices spiked as high as $911/MWh on February 8th at 11am MST and daily averages reached a high of $494.52/MWh on February 10th. Generator outages over the past week compounded this volatility, with Sundance 4, Sheerness 2, Battle River 5 and HR Milner removing a total available capacity of 1,399MW from the grid. With the cold weather expected to last until the weekend, volatility should continue until the start of next week.
The weighted average Hourly Ontario Energy Price (HOEP) is currently at 2.5¢/kWh for February, an increase of 0.6¢/kWh or 32% compared to last week’s settle. Despite demand staying stable relative to average February levels (16,981MW), supply has decreased (-1%, 17,929MW) and shifted towards expensive natural gas, putting upward pressure on HOEP. Nuclear decreased its baseload by 2% (9,478MW), while gas increased its supply by almost 9% (1,822MW). Most other sources decreased their supply to the grid: wind (-9%, 2,018MW), solar (-8%, 61MW), hydro (+2%, 4,522MW), and biofuel (+5%, 27MW). Currently, with the first Global Adjustment estimated at 9.8¢/kWh and the first recovery rate estimated at 0.6¢/kWh, February’s total market price is 12.9¢/kWh.
In other electricity news, the provincial government has further extended the electricity rate relief for customers on a regulated price plan (RPP). The electricity rate cap will remain frozen at 8.5¢/kWh through February 22, 2021 for customers on Time-Of-Use (TOU) and tiered pricing. Additionally, the provincial government has increased its funding for small businesses and registered charities who are struggling to pay their electricity and natural gas bills because of COVID-19. The COVID-19 Energy Assistance Program for Small Business (CEAP-SB) provides a one-time, on-bill credit up to $1,500 for eligible customers. In January 2021, the eligibility criteria was updated so that more customers could qualify for support. To be eligible, customers must have an active account with an electricity distributor (General Service less than 50 kW rate class), a unit sub-meter provider (commercial class that uses less than 150,000 kWh of electricity annually) or a natural gas distributor (non-residential customer that uses less than 50,000 cubic meters of gas annually); must have a registered business or charity number and must have overdue bills since March 17, 2020.
– Mark Ljuckanov, Energy Advisor / Ryan Cosgrove, Energy Data Analyst / Sarah Clemente, Energy Data Analyst