Victory Power Solutions

Latest information about the cold weather coming our way:

Victory is actively working with a great number of existing Texas clients to examine their current hedges and manage risk through FY 2027 when we might expect some price relief as new generation capacity comes online through the PCM efforts designed to effectively control varying Reserve Margin levels. Please email or DM us if you would like to schedule some time to discuss.

From Constellation's weekly Energy Market Update, Victory notes that the basic fundementals of Natural Gas prices and storage levels, Cruid Oil Prices and production levels, Economy, and Weather are all showing Neutral to slightly bearish short-term trends.

Nationally, Natural Gas inventories are 165 Bcf greater than the five-year average and 67 Bcf greater than the same time last year. Crude remains range bound and settled at $70.71 on Monday. Texas weather will remain typical for this time of year with highs in the 70's (80's in the Valley) and lows in the 40's with the odd peak into the 30's.

According to the FED, US Industrial production decreased 0.1% in November making the third straight month of declination. The US Budget Deficit swelled indicating a larger deficit number than the record of $1.8 trillion set in 2023. Households that expect their financial situation to be better a year from now jumped to 37% which is the highest since the pandemic. Peter Navarro announced that planned tariffs should not spur further inflation.

Internationally, Canada's government appears on the verge of collapse while Germany and France have already collapsed. The UK government is on a path to a 'no confidence' vote.

Wholesale electricity prices for FY 2025 are slightly less than those in 2026 and 2027 (not considering the cost of credit or time value of money. Please see the attached chart.