Chart: SP15 Market-Implied Heat Rate

Chart: SP15 Market-Implied Heat Rate#

DAM Hourly LMP at SP15 divided by the SoCal Citygate Gas Price: the Breakeven Generator Efficiency.

Chart#

Sources: CAISO OASIS (PRC_FUEL)

Description#

The market-implied heat rate at SP15: the DAM hourly LMP at the SP15 hub divided by the SoCal Citygate fuel-region price. Units work out to MMBtu/MWh - a heat rate. It is the breakeven efficiency line: any gas generator with a heat rate below the MIHR is profitable to run in that hour. Hovering shows the underlying power and gas prices alongside the ratio.

The dashed reference lines are hypothetical generator heat rates - an efficient CCGT (7.0) and a gas peaker (10.5). Whenever the MIHR is above an asset’s line, that asset is in the money - exactly the payoff of a heat-rate call option struck at that efficiency. The fraction of hours the series spends above each line previews the value of an HRCO at that strike.

Formulas Used:

\[\text{MIHR}_t = \frac{P^{E}_t}{P^{G}_t}\]

\[\text{Payoff}_t = P^{G}_t \times \max\left\{0,\ \text{MIHR}_t - \text{HR}_{\text{strike}}\right\}\]

Data Cleaning Information: N/A - both legs are used as published.

Notes#

Times are UTC; each point is one hour.
Negative values occur in hours where the DAM LMP itself is negative.

Chart Specs#

Chart Name	SP15 Market-Implied Heat Rate
Chart ID	caiso_mihr_sp15
Topic Tags	Mihr, Quanto, Natural Gas
Data Series Start Date
Data Frequency	Hourly
Observation Period
Lag in Data Release
Data Release Timing
Seasonal Adjustment
Units	MMBtu/MWh
HTML Chart	HTML

Dataframe Manifest#

Dataframe Name	CAISO Fuel Prices
Dataframe ID	caiso_fuel_prices
Data Sources	CAISO OASIS (PRC_FUEL)
Data Providers	CAISO
Links to Providers	http://oasis.caiso.com
Topic Tags	Natural Gas, Quanto, Mihr
Type of Data Access
How is data pulled?	src/pulls/pull_caiso_fuel_prices.py via the open-source gridstatus library
Data available up to (min)
Data available up to (max)
Dataframe Path	data\opensource\caiso_fuel_prices.parquet

Linked Charts:

CAISO:caiso_mihr_sp15

Pipeline Manifest#

Pipeline Name	Project-Lab-Energy-Weather-Natgas-Quanto-CAISO
Pipeline ID	CAISO
Lead Pipeline Developer	Brian Nguyen
Contributors	Brian Nguyen, Claire Kim
Git Repo URL
Pipeline Web Page	Pipeline Web Page
Date of Last Code Update	2026-08-27 10:08:05
OS Compatibility	Windows, Linux, macOS
Linked Dataframes	CAISO:caiso_lmp_day_ahead_hourly CAISO:caiso_lmp_real_time_15_min CAISO:caiso_lmp_real_time_5_min CAISO:caiso_fuel_prices CAISO:caiso_fuel_regions CAISO:caiso_load CAISO:caiso_load_hourly CAISO:caiso_fuel_mix CAISO:caiso_renewables_hourly CAISO:caiso_curtailed_non_operational_generator_report CAISO:caiso_outages_aggregated_hourly CAISO:openmeteo_temperature_daily CAISO:eia860m_generators CAISO:us_ba_boundaries

Build Commands:

doit

Chart: SP15 DAM vs RT LMP

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