February 2026 Winter Energy Market Intelligence Report
U.S. wholesale electricity markets are experiencing their most volatile winter since 2021. ISO New England posted record $2.7 billion in January 2026 energy costs, driven by natural gas prices at $6.93/MMBtu. PJM saw a 30% surge in power plant outages from the February cold snap, with day-ahead prices reaching $196/MWh. Meanwhile, California posted negative wholesale prices from solar oversupply. Commercial electricity rates are projected at 17.6¢/kWh nationally for 2026, up 3.5% year-over-year.
Key Takeaways for Commercial Buyers
Winter Cold Snap = Price Spikes
The February cold snap caused the most significant regional price spikes since Winter Storm Uri. ISO-NE and PJM bore the brunt, with natural gas scarcity driving prices above $200/MWh.
Natural Gas is the Price Setter
Gas prices doubled YoY to $4/MMBtu nationally, with Transco Z6-NY hitting $6.93/MMBtu. LNG exports at record 15 Bcfd are competing with domestic supply.
Data Centers Reshaping Grid Economics
PJM capacity prices are surging due to data center demand growth. ERCOT forecasts supply-demand concerns by summer 2026. This is a structural shift, not cyclical.
California's Opposite Problem
While the East Coast deals with scarcity pricing, CAISO is posting negative wholesale prices from solar oversupply. The duck curve continues to deepen.
Market-by-Market Analysis
Record $2.7B January energy costs
Cold weather drove natural gas to $6.93/MMBtu at Transco Z6-NY. LNG exports up 26% YoY to 15 Bcfd. Oil-fired generation surged. Peak load hit 18,743 MW on Feb 2.
30% surge in power plant outages
Cold snap caused nearly 30% increase in power plant forced outages. PJM West prices ranged $113-$196/MWh. Capacity prices for 2026/2027 delivery year rising sharply due to data center demand and fossil plant retirements.
Transmission constraints drive extreme regional splits
Day-ahead prices ranged from $73.67/MWh (Minnesota Hub) to $327.90/MWh (Illinois Hub) on Jan 24. Real-time prices hit $603.22/MWh in Illinois due to binding transmission constraints. Natural gas doubled year-over-year to $4/MMBtu.
Wholesale prices nearly doubled in 2025
2025 annual average hit $74.40/MWh vs $41.81/MWh in 2024. December LBMP surged to $107.81/MWh. Demand forecast up 16% over next decade from building/transport electrification.
Calm now, summer risk rising
Real-time system price $19.41/MWh (Feb 9, GridStatus). Mild winter conditions keeping prices subdued. EIA projects load-weighted avg at $51/MWh for 2026 — 45% increase at ERCOT-North hub. Data centers and crypto mining driving demand growth. Summer supply gap concerns persist.
Negative prices signal renewable oversupply
NP15 hub at -$5.21/MWh, SP15 at -$4.71/MWh on Feb 8. Energy component at -$5.05/MWh across all hubs. Duck curve dynamics continue — midday surplus, evening ramping challenges.
Steady winter premium
February forecast at $36.60/MWh, easing from January's $39.08/MWh. The January jump of 20.7% from December was driven by winter heating demand in the central corridor.
What This Means for Your Business
If you're in the Northeast (ISO-NE, NYISO): Wholesale prices are at their highest since 2014. If your contract expires in the next 6 months, consider locking in forward rates now — the market is pricing in continued gas tightness through 2026. January's $2.7B record costs in New England will flow through to retail rates within 1-2 billing cycles.
If you're in PJM territory (PA, OH, NJ, MD, IL, VA): The capacity price increase for 2026/2027 is a separate line item that will hit regardless of your energy rate. Factor an additional $2-4/MWh into your budget for capacity costs. The cold snap outages are a short-term driver, but the structural shift from data center demand is permanent.
If you're in Texas (ERCOT): Current prices are benign, but summer 2026 risk is real. Lock in your flat-rate contract before the summer heat premium kicks in (typically starts pricing in by March/April). The EIA's $51/MWh projection is a planning floor, not a ceiling.
Action items across all markets:
- Review contract expiration dates — don't let renewals auto-roll in a rising market
- Request updated forward curves from your broker or REP
- Budget for 3-5% retail rate increases on average in 2026
- Evaluate demand response enrollment — PJM Economic DR is paying strong capacity credits
Data Sources
• ISO-NE Mid-Week Market Update, February 2-5, 2026 (iso-ne.com)
• PJM Data Viewer — Real-Time LMP data, February 2026 (pjm.com)
• NYISO Market Operations Report, December 2025 (nyiso.com)
• ERCOT Real-Time Settlement Point Prices, February 7-8, 2026 (ercot.com)
• MISO Day-Ahead & Real-Time Market Reports, January 24, 2026 (misoenergy.org)
• CAISO OASIS — Real-Time 5-min LMP, February 8, 2026 (caiso.com)
• SPP Integrated Marketplace data (spp.org)
• EIA Short-Term Energy Outlook, January 2026 (eia.gov)
• EIA Electricity Monthly Update (eia.gov)
Report generated by EnergyForge Intelligence Engine — February 9, 2026. All data points sourced from official ISO/RTO and EIA publications.