Already Stunned by Gas Prices, Shockingly High Electricity Prices May Await Americans This Summer

[jpak]

http://energytechstocks.com/wp/?p=1289

Americans may pay a lot more for electricity this summer, federal energy officials and the spot power market indicate. Worst hit could be the Northeast, especially the area from Boston to New York City, where forward prices from the InterContinental Exchange for July-August 2008 have been running up to 75% and higher over year-ago levels.

While higher forward prices aren’t a guarantee of higher actual prices this summer, “Wholesale electric prices are likely to be considerably higher than they were a year ago,” America’s Federal Energy Regulatory Commission (FERC) warned last month. FERC said this year’s higher price for natural gas, the most frequently used fuel for peak power generation, is the main reason why. On Monday Raymond James & Associates, the investment banking firm, raised its forecast for summer natural gas prices by 20%, citing colder weather, low imports of liquefied natural gas (LNG), and ongoing infrastructure repairs as reasons why it anticipates a 200 billion cubic foot (Bcf) year-over-year storage deficit by July.

FERC said that even if natural gas prices don’t keep rising, power prices likely will still go up because the U.S. has added little baseload capacity over the last few years. “As a result,” FERC said in its summer reliability report, “the electric system must use generators that cost progressively more to run.”

Newspapers including the Wall Street Journal last week reported on rising power prices in Texas, but sharply higher prices appear to await Americans from coast to coast. In parts of southern California, for instance, forward prices have been running roughly 75% higher than a year ago, while parts of the Midwest have been seeing roughly 50% increases.

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[no_hypocrisy]

1. Here in NJ, PSE&G and other utilities are asking for a 20 percent hike in rates.

[katmondoo]

2. Is this the Cheney secret energy policy

[predfan]

3. I heard on NPR a story about electric usage in Israel, and I assume many countries.

The electricity is bought in advance of usage, you buy whatever amount you want, it's loaded onto a card, then swiped through your meter at home, indoors. Your account is then credited whatever amount you purchased.

Think this wouldn't do wonders for conservation? Making sure those closet lights were off, and water heater turned down would be the norm. Also, watching your meter spin during laundry time would make the old clothsline look a lot better.

[Javaman]

4. I signed onto wind power earlier this year. I saw the writing on the wall.

I'm now locked into a rate for the next 15 years.