New England Power Prices Soar on Higher Gas Costs, Deep Freeze

(Bloomberg) -- Electricity prices in New England jumped on Tuesday as a frigid start to the day spurred demand when the cost of natural gas used to fuel power plants soared.

Real-time power prices on the six-state grid in the U.S. Northeast averaged $141.90 a megawatt-hour as of 11 a.m., up fourfold from the same period on Monday, according to ISO New England data.

Temperatures were at about 24 degrees Fahrenheit (-4 Celsius) in Boston at 11 a.m., spurring heating demand. Power is also more expensive this week because of a jump in natural gas prices, the main fuel for power plants. Spot gas prices on Enbridge’s Algonquin system that serves New England jumped 88% on Monday from the prior trading day.

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New England is frequently the most sensitive region to gas-supply constraints because it’s geographically at the end of the massive U.S. pipeline network. Attempts to build more pipelines to increase the flow have failed, and the region has to compete with places like Europe and Asia to lure cargoes of the fuel.

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