WSI Calls for Cool Period in Most of Eastern US, Warm West During Remainder of Summer
WSI and ESAI Say Cooler July Weather Will Engender Lower Loads, Moderate Power Prices for Energy Traders
Andover, MA, June 24, 2009 — WSI expects the upcoming period (July-September) to average cooler than normal across the eastern third of the US, with above-normal temperatures common across the western US. The highest probability for a cooler-than-normal period is in the Southeast, while the Rockies and Pacific Northwest are most likely to experience above-normal temperatures. The WSI seasonal outlooks reference a standard 30-year normal (1971-2000).
“We expect the upcoming transition to warmer temperatures
in the western US and cooler temperatures in the Southeast to be the prevailing
pattern for the rest of the summer,” said WSI seasonal forecaster
Dr. Todd Crawford. “In the Northeast, the cool start will likely
be representative of the pattern for the remainder of the summer, although
occasional bursts of heat coming from the north-central US will likely
impact the area from time to time. Looking farther out in time, the emerging
El Nino event will likely play a significant role in determining the upcoming
fall and winter pattern, although the magnitude and exact location of
the warmest tropical Pacific Ocean temperature anomalies will be the final
arbiter.”
In July, WSI predicts regional temperature anomalies as follows:
Northeast – Cooler than normal
Southeast – Cooler than normal
N Central – Warmer than normal
S Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal, except coastal CA
According to Paul Flemming, ESAI’s Director of Power and Gas, “The
WSI July forecast indicates slightly cooler-than-normal across most of
the eastern portion of the country as well as California. The eastern
states and California represent a large portion of US demand and cooler
temperatures will mean lower loads, moderate power prices and lower natural
gas demand from the power sector. Warmer temperatures in the rest of the
country, particularly Texas, will offset lower power sector gas demand
from the east.”
In August, WSI sees the monthly breakdown as:
Northeast – Cooler than normal
Southeast – Cooler than normal
N Central – Warmer than normal, except WI/IL
S Central – Cooler than normal, except west TX
Northwest – Warmer than normal
Southwest – Warmer than normal, except coastal CA
“The WSI August forecast indicates cooler-than-normal temperatures
east of the Mississippi and in parts of Texas, with much cooler temperatures
expected in all of the major load centers across the country, including
California, Texas and the East,” said Paul Flemming of ESAI. “In
the absence of significant hurricane activity, cooler-than-normal temperatures
across much of the country will result in lower power sector gas demand,
increasing inventory build rates and downward pressure on prices. Lower
power demand due to moderate temperatures and the economic climate will
result in moderate power prices in the major markets. The cooler outlook
reduces the likelihood of major heat events in the Northeast.”
In September, WSI forecasts:
Northeast – Warmer than normal, except PA/NJ
Southeast – Cooler than normal
N Central – Warmer than normal
S Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal
“The WSI September forecast indicates warmer-than-normal temperatures in most of the country and much-warmer-than-normal temperatures in Texas. Natural gas demand from the power sector is likely to be above average in September, but will not likely offset the trend towards very high inventories in early November,” noted Paul Flemming. “Power prices in Texas could be volatile with higher probabilities of late summer heat events.”
WSI, which provides customized weather information to
energy traders, issues its seasonal outlook twice-monthly. The next new
forecast package (for the August-October and September-November periods)
will be issued on July 22.
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