MorganEnergy

A casual glance at this report from Platts could make you very worried about the state of the California electricity market. Hitting the price cap 465 times in June? Why, where are 720 hours in the whole month!

Fortunately that’s not quite what they mean. To start with these are prices from the Real Time market. They are almost certainly 5 minute prices, not hourly prices. The hourly price is an average of the 5 minute prices. In addition a quick check of CalISO‘s web site shows that what they actually reported was 465 prices over $250/MWh, not 465 prices hitting the $399.99/MWh price cap. According to the OASIS data, hourly real time prices in both the NP15 and SP15 zones exceeded $250/MWh only 30 times in June.

Then again, that’s once a day, which is quite a lot. It is probably about time for some politician to complain that the market is failing because it is not encouraging new build.