The widely predicted explosion in New England’s energy prices has started sooner than most people expected.
The price of natural gas at Boston’s Algonquin Citygate climbed from $4.13 per MMBtu last Wednesday to $20.40 on Tuesday.
Natural gas prices are tightly correlated with electric power prices in New England. These near-record natural gas prices at the Algonquin trading point pushed forward, wholesale power prices up to more than $100 per megawatthour (MWh) at the Massachusetts Hub for December 2013.
While the $100 per MWh future price may have seemed high at the time, the actual market price is likely to be significantly more than that amount. The real time locational marginal price spiked above $350 per MWh in southeastern Massachusetts early this morning and remained above $250 per MWh for most of the day.