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Power prices soar as Americans fight heat wave

High temperatures in Los Angeles are expected to top 32 deg C this week, with the mercury forecast to peak at 36 deg C on Tuesday

People cooling off from a Southern California heat wave at Cardiff State beach in Encinitas on July 6.

US West Coast power and natural gas prices for Tuesday soared as consumers cranked up their air conditioners for a second day in a row to escape a brutal heat wave.

This heat wave is not expected to be as hot or long-lived as the recent experience in late July when the power grid urged customers to conserve energy and the gas company warned of possible service curtailments.

So far this week, electric and gas companies have not taken any major steps to reduce consumption.

Power and gas prices for Tuesday soared to their highest on record at the Mid Columbia EL-PK-MIDC-SN power hub in the Pacific Northwest.

Elsewhere in the region, prices jumped to their second-highest levels on record since hitting all-time highs during a heat wave in late July at the Palo Verde EL-PK-PLVD-SNL power hub in Arizona and the SP-15 EL-PK-SP15-SNL power hub in Southern California, according to Reuters data going back to 2010.

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High temperatures in Los Angeles, the second-biggest US city, are expected to top 32 deg C from Monday to Friday, with the mercury forecast to peak at 36 deg C on Tuesday, according to AccuWeather. The normal high in the city is 29 deg C at this time of the year.

Southern California Gas (SoCalGas), which supplies gas to over 21 million consumers in the southern part of the state, continued to call on customers to "pay close attention" to notices from the utility and schedule volumes accordingly, with power generators expected to burn more fuel than usual to keep air conditioners humming.

Gas supplies are expected to remain tight in Southern California this summer and winter due to reduced availability from SoCalGas' Aliso Canyon storage facility in Los Angeles, following a massive leak between October 2015 and February 2016, and ongoing shutdowns of several pipelines.

SoCalGas projected gas demand would hold around 2.8 billion cubic feet per day (bcfd) on Monday and Tuesday before easing to 2.7 bcfd as the weather starts to cool later in the week. During the last heat wave, SoCalGas deliveries peaked around 3.0 bcfd on July 24.

One billion cubic feet of gas is enough to fuel about 5 million US homes for a day.

SoCalGas is a unit of California energy company Sempra Energy.

The California Independent System Operator (ISO), which oversees the state's power grid, forecast use would peak this week at 44,491 megawatts on Tuesday before easing to 44,239 MW on Wednesday. That falls short of the 46,412 peak hit during the last week-long heat wave on July 25 and the grid's all-time high of 50,270 MW in July 2006.

One megawatt can power about 1,000 US homes. REUTERS

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