EnergyWindow, Inc.: MarketElert(TM)

05/17/2008

EnergyWindow MarketElert ^TM - July 2004
www.energywindow.com

July Elerts
Energy Futures Trends

California - Negotiations between Assembly Speaker Fabian Nunez and electric power marketers have resulted in several changes to AB 2006, also called the Southern California Edison bill, making it likely that many commercial customers will be able to shop for electricity again when the law takes effect on January 1, 2006. Several details still need to be ironed out, among them what size accounts will be able to shop - 200, 300 or 500 kW, and whether this will be a per-account number or an aggregated load. Click AB 2006 Text for more.

New Jersey/Maryland - High wholesale markets this spring have continued to frustrate switching in New Jersey and Maryland, though CIEP (hourly accounts) in New Jersey have been able to get 6 mills/kWh or more off their variable rate while Type III (>600 kW) accounts in Maryland have also been able to save, especially by entertaining contracts beginning in October.

Summertime - No Time to Take Your Eye off the Markets

Summertime is traditionally a time for vacations, a relaxed dress code and thinner staffs on Monday and Friday. It's also a time when most electricity and natural gas contracts have either been taken out or renewed, or postponed until fall. This summer is no different ... or is it? Electric markets like Maryland and New Jersey have been disappointing, mainly because they have fallen prey to high prices driven by natural gas. The same holds true in electric markets all around the country. Some experts, fearing the effects of a resurgent economy, tight gas supplies and hotter than usual weather, are calling for wholesale gas prices to rise enough to result in a doubling of electricity wholesale prices. However, the gas market has come off a bit in the last few weeks, and despite dire predictions, EIA's storage report came in surprisingly strong last week, adding 109 BCF and pushing the level to above the 5-year average for the second week in a row (click on EIA Natural Gas Storage Report to see last week's report). PJM electricity is now trading at the lowest point since the end of April and, if fundamentals remain good, a drop of just a few dollars more per-MW (or 50-60 cents in the natural gas strip) could signal the potential for widespread electric savings this summer. Natural gas prices, too may offer up an opportunity to fix a price at a relatively favorable time. Gas prices traditionally rise at the onset of cooler weather, so buyers that want to be able to take advantage of a summer downturn should take time now to seek markets and suppliers that will provide opportunities for your sized accounts. But don't expect prices to set record lows. Experts agree that the upside potential for gas prices in the short run exceeds the downside (click here for a summary of opinions from the recent EnergyWindow/Platts Natural gas Webinar and some ideas for strategies to deal with the outlook). So enjoy the beach, go to the mountains, wear shorts to work, but don't take your eyes off the markets.

Quick Buyers' Tip
Unlike electricity, published natural gas prices can be transacted in real time. If you are still on tariff gas rates it may be time to consider switching to a competitive supplier for an indexed contract that may offer you some savings but, more importantly, put you in a position to act quickly if markets present the opportunity to fix a price for some forward term.

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