At the end of December 2023, the 2024 calendar year electricity price dropped to just under 5 cents per kWh hitting a 24-month low of 4.99 cents. At the end of 2022, the same 2024 strip was trading at 8.85 cents per kWh.  While the 2024 strip price was declining in the fourth quarter of 2023, the 2025 and 2026 prices fell by the end of the year to 20-month lows at 5.7 and 5.6 cents respectively. Table 1 depicts the electricity price trends for 2024, 2025 and 2026 updated through December 29, throughout the past 4 years.

Table 1 – 2024 – 2025 – 2026

As we entered 2024, the 2025, 2026 and 2027 strip prices ticked up two weeks in a row, then started a decline for nearly 5 weeks to a low of approximately 5.4 cents. Price drops were indicative of the declining natural gas prices driven by mild weather and favorable natural gas storage reports. In mid-February natural gas prices rebounded and the electricity strips followed suit through March 8, however still trading at 2-year lows. Table 2 depicts the electricity price trends for 2025, 2026 and 2027 updated through March 8, 2024 for the past 4 years.

Table 2 – 2025 – 2026 – 2027

Key Influences: Analyzing Factors Behind the Declining Prices

Table 3 helps to portray the continued influence natural gas prices have on electricity prices in New England. When the 2024 natural gas price started a steep decline at the beginning of November 2023 continuing through the end of the year, the electricity strip for 2024 reacted accordingly.

Very favorable natural gas storage levels throughout the winter were partly a result of the mild weather. Storage levels have remained above the 5-year average since January 2023 and are now well above the 5-year maximum. Table 4 depicts the 5-year rolling storage level for the past two years as of March 1, 2024.

Table 3 – Electricity – Natural Gas Price Relationship

Table 4 – Natural Gas Storage as of March 1, 2024

Note: Electricity prices referenced here are energy-only and do not reflect a total electricity supply price that includes capacity, ancillaries, RECs, etc.