Houston Spark Spread Tanks
October 24, 2022
The Houston spark spread is its lowest since March 2021. At $18.95/MW according to the Schork Report, this is a bearish signal for natural gas as it indicates a low financial incentive for natural gas generators to buy natural gas and produce electricity. Spark spreads are a calculation involving current prices of energy and natural gas, and a measure of generating efficiency (heat rate). The Houston average for the year until last week was $71.33/MW. Last week’s Houston spread was the third consecutive week it has been lower than all other major retail markets served by ENGIE.