Spark Spreads Double Y-O-Y
April 26, 2021
The spark spreads in mid April are double year-over-year in three markets. In Houston, the spread last week was $32.50 versus $15.63. In New York City, it’s $11.02 vs. $5.53. In New England the spread is $11.73 versus $6.37. These are bullish signals for natural gas as they indicate a financial incentive for natural gas generators to buy natural gas and produce electricity, versus buying power on the grid. Spark spreads are a calculation involving current prices of energy and natural gas, and a measure of generating efficiency (heat rate).