Power prices in the U.S. West soared to record highs for a second day on Tuesday, and California utilities urged consumers to conserve energy to avoid more rotating outages as a brutal heatwave pushes demand close to an all-time high.
PG&E Corp, the state’s biggest power company, told customers that rotating power outages were likely to occur on Tuesday afternoon and evening lasting about two hours.
On Friday and Saturday, the California ISO, which operates the grid for most of the state, ordered utilities to start outages that left over 400,000 homes and businesses sweltering for about an hour each as air conditioning demand outstripped available generation resources.
On Monday, the ISO told utilities to prepare for more outages but never issued the order because the weather moderated and consumers reduced the strain on the grid by using less power.
The last time the ISO imposed rotating outages was in 2001 when several energy companies manipulated the power market to cause prices to spike and electric supplies to run artificially short.
California power companies with outages over the weekend included units of PG&E, Edison International and Sempra Energy.
Meteorologists at AccuWeather forecast high temperatures would reach the 90s Fahrenheit (35 Celsius) in some California cities through mid week. That is over 10 degrees F higher than normal.
The ISO forecast demand would reach 49,565 megawatts (MW) on Tuesday, which is just shy of the grid’s all-time high of 50,270 MW in 2006, before sliding to 47,382 MW on Wednesday.
Power prices for Tuesday averaged record highs of $1,311 per megawatt hour (MWh) at the Palo Verde hub in Arizona and $698 in SP-15 in Southern California, according to Refinitiv data going back to 2010.
The Intercontinental Exchange said prices for Wednesday averaged $1,640/MWh at Palo Verde and $511 at SP-15.
Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.