WSI: Above-Normal Spring Heating Demand Likely In Great Lakes/Northeast

Early Look at Summer Suggests Reduced Risk of Excessive Heat in Central/Eastern US

ANDOVER, Mass. (March 24, 2014) — WSI (Weather Services International) has issued their forecast for spring (April-June) 2014, and expects below-normal temperatures from the northern Rockies to the Northeast, with above-normal temperatures elsewhere, especially along the Pacific Coast. The WSI seasonal outlooks reference a standard 30-year normal (1981-2010).

According to WSI Chief Meteorologist Dr. Todd Crawford: “Although we do not expect the unusual magnitude of the March cold, relative to normal, to continue into April, we do expect a general persistence of the same pattern we’ve seen much of the winter. That means warmer-than-normal temperatures in the West and below-normal temperatures across much of the central/eastern US. As the El Nino event develops heading into summer, we expect northeastern Pacific ridging to become an important driver, which should keep the risks of excessive heat limited to parts of the western US.”

In April, WSI sees the monthly breakdown as:
Northeast – Colder than normal
Southeast – Colder than normal, except Florida
North Central – Colder than normal
South Central – Warmer than normal, except Texas
Northwest – Warmer than normal
Southwest – Warmer than normal

According to Chris Kostas, Senior Power and Gas Analyst at ESAI Power LLC: “A mixed picture is developing for April with colder-than-normal temperatures centered over the Great Lakes Region but warmer-than-normal temperatures centered over the Southwest. While weather-related demand is typically soft in April, colder-than-normal Northeast temperatures during the first week of the month could extend the withdrawal season into early April and help to bolster gas prices during the first half of the month. The start of generator maintenance and low inventory levels should also help to support natural-gas prices in April. Early cooling demand in the Southwest should also create a bullish energy environment and help to slow injections.”

In May, WSI forecasts:
Northeast – Warmer than normal
Southeast – Colder than normal
North Central – Colder than normal
South Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal

Kostas added: “With slightly warmer-than-normal temperatures expected over much of the country in May, power and gas prices are likely to find continued fundamental support. Generation maintenance combined with slightly higher-than-normal electrical loads should help to support implied market heat-rates throughout the country but particularly in Texas where the cooling season starts earlier. Natural gas storage injections will likely run around 3.0 Bcf/day above last year’s level. Increased injection demand should support prices in May. Increased natural gas production and higher year-over-year coal-fired generation should help to offset some of the increased demand, however, and prevent prices from running-away to the upside.”

In June, WSI forecasts:
Northeast – Warmer than normal
Southeast – Warmer than normal, except Florida
North Central – Colder than normal
South Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal, except Colorado/New Mexico

Kostas continued: “With slightly warmer-than-normal temperatures expected to continue over most of the country in June, power prices and implied market heat-rates are likely to find strength in New England, New York, PJM, ERCOT, and CAISO. After the extraordinarily cold winter caused inventories to draw down to very low levels this past winter, a warmer-than-normal start to the summer could help to push natural gas prices firmly higher in June.”

WSI provides customized weather information to global commodity traders via its industry-leading WSI Trader Web site. WSI will issue its next seasonal outlook on March 31.

About WSI Corporation 
WSI is the world's leading provider of weather-driven business solutions for professionals in the aviation, energy and media markets, as well as multiple federal and state government agencies. WSI is the Professional Division of The Weather Company and is headquartered in Andover, Massachusetts with offices in Madison, Wisconsin and Birmingham, England. The Weather Company is owned by a consortium made up of NBC Universal and the private equity firms The Blackstone Group and Bain Capital. More information about WSI can be found at www.wsi.com

About ESAI
Since its inception in 1984, Energy Security Analysis Inc. (ESAI) has been dedicated to monitoring, analyzing and synthesizing information about world-wide energy markets. Tapping the talents of its senior-level staff, ESAI provides clients with unparalleled insight into where the markets have been and where they are headed. ESAI provides ongoing systematic analysis of energy prices in the oil, natural gas and energy markets. For more information on ESAI services, see www.esai.com.

Media Contacts:
Linda Maynard, WSI
(978) 983-6715, lmaynard@wsi.com

Tommy Sutro, Energy Security Analysis, Inc.
(781) 245-2036, tsutro@esai.com