This analysis focuses on the electricity prices on the CAISO (California Independent System Operator) day-ahead market. CAISO reports day-ahead electricity prices for four major electric utility companies serving California residents. I display the prices for PG&E (Pacific Gas and Electric Company) utility that provides electricity to the Northern two thirds of California.
The plot below shows average daily prices on the day-ahead market for PG&E during 2016 and 2017.
The prices are highest in late afternoon and evening, peak at 6-7 pm, and experience a smaller peak at 6-7 am. The peaks and low points are more extreme in the 2017’s data.
I compare the daily electricity patterns for different months of the year. The data are the 2016-2017 prices for day-ahead contracts with PS&E.
February through May have the lowest prices during most of the day and the lowest evening peaks. The highest evening prices occur in August through October.Prices vary depending on the day of the week. On the weekends the prices are lower reflecting the lower demand for electricity
We have seen that the daily patterns vary depending on the month of the year and day of the week. I plot the actual daily prices for the most recent 16 days to examine the variability in prices from day to day.
The plot below shows the day-ahead electricity prices for the second half of December 2017. The daily price volatility exhibits predictable patterns. The lowest price of the day falls on 12 pm or 1 pm, and the highest, on 5 pm or 6 pm. The second daily price peak occurs 6am - 8 am.