WSI Calls for Cool Period in Most of Eastern US, Warm West During Remainder of Summer

WSI and ESAI Say Cooler July Weather Will Engender Lower Loads, Moderate Power Prices for Energy Traders

Andover, MA - June 24, 2009 — WSI expects the upcoming period (July-September) to average cooler than normal across the eastern third of the US, with above-normal temperatures common across the western US. The highest probability for a cooler-than-normal period is in the Southeast, while the Rockies and Pacific Northwest are most likely to experience above-normal temperatures. The WSI seasonal outlooks reference a standard 30-year normal (1971-2000).

“We expect the upcoming transition to warmer temperatures in the western US and cooler temperatures in the Southeast to be the prevailing pattern for the rest of the summer,” said WSI seasonal forecaster Dr. Todd Crawford. “In the Northeast, the cool start will likely be representative of the pattern for the remainder of the summer, although occasional bursts of heat coming from the north-central US will likely impact the area from time to time. Looking farther out in time, the emerging El Nino event will likely play a significant role in determining the upcoming fall and winter pattern, although the magnitude and exact location of the warmest tropical Pacific Ocean temperature anomalies will be the final arbiter.”

In July, WSI predicts regional temperature anomalies as follows:

Northeast – Cooler than normal
Southeast – Cooler than normal
N Central – Warmer than normal
S Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal, except coastal CA

According to Paul Flemming, ESAI’s Director of Power and Gas, “The WSI July forecast indicates slightly cooler-than-normal across most of the eastern portion of the country as well as California. The eastern states and California represent a large portion of US demand and cooler temperatures will mean lower loads, moderate power prices and lower natural gas demand from the power sector. Warmer temperatures in the rest of the country, particularly Texas, will offset lower power sector gas demand from the east.”

In August, WSI sees the monthly breakdown as:

Northeast – Cooler than normal
Southeast – Cooler than normal
N Central – Warmer than normal, except WI/IL
S Central – Cooler than normal, except west TX
Northwest – Warmer than normal
Southwest – Warmer than normal, except coastal CA

“The WSI August forecast indicates cooler-than-normal temperatures east of the Mississippi and in parts of Texas, with much cooler temperatures expected in all of the major load centers across the country, including California, Texas and the East,” said Paul Flemming of ESAI. “In the absence of significant hurricane activity, cooler-than-normal temperatures across much of the country will result in lower power sector gas demand, increasing inventory build rates and downward pressure on prices. Lower power demand due to moderate temperatures and the economic climate will result in moderate power prices in the major markets. The cooler outlook reduces the likelihood of major heat events in the Northeast.”

In September, WSI forecasts:

Northeast – Warmer than normal, except PA/NJ
Southeast – Cooler than normal
N Central – Warmer than normal
S Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal

“The WSI September forecast indicates warmer-than-normal temperatures in most of the country and much-warmer-than-normal temperatures in Texas. Natural gas demand from the power sector is likely to be above average in September, but will not likely offset the trend towards very high inventories in early November,” noted Paul Flemming. “Power prices in Texas could be volatile with higher probabilities of late summer heat events.”

WSI, which provides customized weather information to energy traders, issues its seasonal outlook twice-monthly. The next new forecast package (for the August-October and September-November periods) will be issued on July 22.

About WSI Corporation

WSI is the most trusted source of weather information across the globe. Top insurance, risk management companies and financial institutions, worldwide, trust WSI to supply them with easy-to-use, timely and expert weather guidance to help anticipate market volatility, mitigate risk and make critical decisions with confidence. WSI is a member of The Weather Channel Companies and is headquartered in Andover, Massachusetts, with offices in Birmingham, England. The Weather Channel Companies are owned by a consortium made up of NBC Universal and the private equity firms, The Blackstone Group and Bain Capital. For more information, please visit us on the web at www.wsi.com or call us at 877.WSI.CORP or +44.121.233.7600.

About ESAI Corporation

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 visit www.esai.com.