UEC Insights: September 19, 2025
Market Update
Natural gas prices saw a modest increase two weeks ago, with October up about $0.30, though overall market fundamentals remain soft. Cooler-than-normal August weather lowered power burn demand by roughly 6 Bcf/day, with productions remaining steady near 107 Bcf/day. Storage levels are on track to reach 4 Tcf by the end of injection season - about 5% above the five-year average - and upcoming reports are expected to show continued larger-than-normal builds, adding to the bearish outlook. For the week ending 8/29, the storage build was 55 Bcf, in line with expectations but bearish compared to the five-year average in the mid-30s. Pricing continues to move sideways around $3.08/MMBtu.
On the power side, cash prices held steady in the high $20s to low $30s, reflecting limited demand from mild weather. LNG remains one of the few bullish factors, with flows above 3 Bcf/day and the Golden Pass terminal expected online later this year, though global demand concerns persist with China’s growing solar adoption.
New York capacity prices rose modestly in a recent Con Ed auction for the 2026/2027 and 2027/2028 planning years. Overall, mild weather, strong production, and robust storage continue to weigh on prices, while LNG demand provides the primary source of support.
DOE Extends Emergency Order to Keep Pennsylvania Power Units Online
The U.S. Department of Energy (DOE) has extended an emergency order requiring two 380-MW gas and oil-fired units at the Eddystone power plant near Philadelphia to remain in service through November 26, 2025. The units were initially scheduled for retirement earlier this year, but DOE cited ongoing concerns about resource adequacy within the PJM Interconnection as justification for keeping them online.
According to the DOE, increasing demand and the accelerated retirement of older generation facilities could pose reliability risks over the coming years. The Eddystone units produced 17,000 MWh in June, including during a late-month heat wave, underscoring their contribution to system stability during peak demand. The department acted under authority granted by the Federal Power Act, which allows temporary operating mandates during energy emergencies to safeguard grid reliability.
The decision, however, has drawn opposition from consumer advocates and environmental organizations, who argue that the circumstances do not rise to the level of an immediate emergency. They noted that during the June heat wave, PJM exported a net 273,062 MWh, suggesting that supply remained sufficient. They contend that long-term solutions are needed to balance reliability and affordability without prolonging reliance on aging infrastructure.
While debate continues, the order reflects broader concerns about maintaining adequate supply as the region’s energy landscape evolves. PJM and federal agencies are expected to continue evaluating potential risks and strategies to ensure system reliability in the year ahead.
PJM Confronts Rising Data Center Demand Amid Stakeholder Pushback
PJM interconnection is accelerating discussions on how to manage rapidly growing power demand from data centers, which could reach 30 GW by 2030. The grid operator has proposed the idea of a “non-capacity-backed load” (NCBL) service, designed to allow the temporary curtailment of certain large loads in times of supply shortages while helping preserve system reliability.
The proposal, however, has sparked significant opposition. Data center companies, utilities, and PJM’s market monitor argued that the plan lacks clarity, risks undermining market rules, and could unfairly shift costs. Industry leaders such as Amazon urged PJM to abandon the NCBL concept and instead focus on improving demand forecasting, streamlining interconnection processes, and strengthening regional transmission planning. The Data Center Coalition, representing Google, Meta, and Microsoft, said the framework exceeds PJM’s authority and contradicts existing tariff rules.
Critics also questioned whether data centers designed for near-constant uptime would ever agree to curtailments under the NCBL structure. Instead, some suggested allowing data centers to bring their own resources onto the grid in exchange for faster interconnection approval.