- DAILY GPI
- MEXICO GPI
- SHALE DAILY
Temperatures will average cooler than normal across the Northeast next month, keeping the pedal on energy consumption in some of the nation's major population centers, but warmer-than-normal temperatures will dominate the region in May and June, according to forecasters at Weather Services International (WSI).
"The 2015 El Nino event is currently emerging from the depths of the tropical Pacific, and the atmospheric response will promote below-normal temperatures in April from the south-central states to the Southeast and up the East Coast," said WSI Chief Meteorologist Todd Crawford. "Meanwhile, above-normal temperatures will continue to persist across much of western and northern U.S."
The long-awaited El Nino event -- warmer-than-average sea surface temperatures in the central Pacific Ocean near the equator -- has arrived, but unlike some of its predecessors, it is likely to remain weak and exert little influence on global weather and climate, according to a recent forecast from the National Oceanic and Atmospheric Administration (NOAA) (see Daily GPI, March 6). The El Nino, which is expected to continue into the summer, adds to growing concerns about snowpack and water supplies for hydropower in the western United States, NOAA said.
"As we head towards summer, the presence of El Nino, combined with western drought and relatively cool Atlantic Ocean temperatures, will favor another reasonably cool summer across much of the eastern two-thirds of the U.S.," Crawford said. "Unfortunately, the western heat and drought will likely persist through the summer. There is hope, however, that the 2015 El Nino event will be strong enough to force beneficial western rains next winter."
Temperatures will average colder than- normal across the East and Central areas next month, with the West averaging warmer than normal, WSI said Monday. The colder-than-normal weather in the Northeast should produce a marginal increase in natural gas demand, which, combined with nuclear outages and coal-fired retirements, would support gas and power prices in New York, New England and the Mid-Atlantic region, according to Chris Kostas, senior power and gas analyst at Energy Securities Analysis Inc.
"A significant portion of the nation’s coal-fired fleet is expected to retire mid-month due to the EPA's Mercury and Air Toxics Standards (MATS) rule, effective April 16 [see Daily GPI, Dec. 21, 2011]," Kostas said. "Warmer-than-normal temperatures in the West should keep electrical loads slightly firmer than normal in that region, though loads are not expected to be firm enough to result in a significant impact on power prices. Reduced hydroelectric supplies in the West, related to below-normal snowpack this winter, will also help to support western power prices slightly as electrical loads begin to increase."
In May, WSI expects the entire northern tier to average warmer than normal and the southern tier to be cooler than normal.
"While natural gas prices are expected to be relatively soft in May (due to the year-over-year increase in natural gas production), warmer-than-normal temperatures over the northern half of the country should help to firm implied market heat-rates in MISO, PJM, New York and New England, particularly as electrical loads begin to increase later in the month," Kostas said. "Generator maintenance will continue to influence power prices and implied market heat-rates by reducing available baseload generation." MATS-related coal-fired generator retirements should begin to affect power prices and implied market heat-rates as electrical demand begins to increase, he said.
Only the Southeast and South Central areas are likely to remain cooler than normal in June, and warmer-than-normal temperatures will dominate the rest of the country, according to WSI forecasters. That early summer warmth across the PJM and Midwest ISO footprints could trigger "the first real effects" related to the coal-fired retirements, Kostas said.
"Year-over-year natural gas demand is expected to increase as the gas-fired fleet is called on to replace the lost coal-fired generation. Implied market heat-rates are expected to become quite lofty in these regions as relatively soft natural gas prices combine with increasing cooling demand later in June. With warmer-than-normal temperatures also expected in California and the Northwest, power prices and implied market heat-rates are also likely to be strong, considering the diminished hydroelectric potential caused by the below-normal Western snow pack this winter."