CPV RETAIL BLOG

October 26, 2026

What the 2027 Winter outlook could mean for Energy Markets

By: Bob Barron, VP, Energy Management, Competitive Power Ventures (CPV)

NOAA’s latest U.S. Winter Outlook points to a warmer-than-average winter across much of the northern United States, including the Midwest and much of the East. The outlook also favors wetter-than-average conditions across the southern U.S. and along the East Coast, with El Niño expected to influence weather patterns from December 2026 through February 2027.

A warmer winter could ease heating demand

If temperatures are milder than average, heating demand could ease in some regions. That may provide some relief to winter energy markets, but the outlook is an early seasonal forecast, not a prediction of energy prices. Actual market conditions will depend on how the weather develops, including the timing and severity of cold spells, as well as supply and other market factors.

NOAA’s outlook is consistent with signals that some models have shown earlier this year. Still, there is time for forecasts to change as the season approaches.

Looking ahead to summer

Some early modeling has also raised the possibility of warmer-than-average conditions beyond the winter months, which could contribute to summer market volatility in 2027. That remains uncertain, and more information will be needed before drawing conclusions about next summer.

CPV Retail will continue to monitor seasonal forecasts and market conditions as they evolve, helping customers consider what changing weather patterns could mean for their energy planning.

NOAA’s next seasonal update is scheduled for November 19, 2026.

Source: NOAA’s U.S. Winter Outlook

PJM Regulatory Review

  • PJM continues the process of maneuvering through “FERC reconciliation/suggestions” so the Reliability Backstop Auction can proceed. The timing is interesting because the next Base Residual Auction (BRA-2029/2030) is scheduled for December and is likely to result in an additional capacity shortfall from the prior BRA.

  • The original RBA was accepted by FERC on September 29, but was suspended for 5 months and was subject to additional modifications/comments from FERC.

  • The multi-phase process combines a bilateral contracting period coupled with a central procurement process, allowing PJM to deal with a likely shortfall.

  • PJM’s current forecast anticipates a 32,000 MW peak load growth by 2030, consisting primarily of data centers.

NYISO Regulatory Review

  • The NYISO updated their market tariffs after a FERC Commission Order was issued on October 19.
  • Recent proposed changes to the tariffs include provisions to address the seasonal reliability risks and improve their assessment of seasonal availability of resources. Firm transportation constraints is a key parameter for winter supply metrics.
  • The ISO is still facing tight reserve margins even with additional solar resources being deployed and available dispatchable generation remains stagnant.

Market Drivers

Market Drivers as of October 23, 2026.

  1. Gas Storage/Year over year difference. A positive number is bearish, and a negative number is bullish.
  2. Production /Year over year growth/trend is important in the context of demand growth.
  3. LNG Exports/Year over year growth means demand is growing and should be looked at in comparison to production trend.
  4. Mexican Exports/Add to LNG Exports to show a trend in exports compared to the production trend.
  5. PJM Outages- generally seasonal in Spring or Fall/Can support short-term prices.
  6. Gas Focused Rig Count/Is drilling increasing to grow production versus demand growth. This can be seen as impacting price in the future based on expected load growth.

Energy Market Update

  • The natural gas price sell-off continues unabated as production remains strong and expectations of continued warm weather have taken the premium out of the winter. The November NYMEX is near lows of 2020 at $2.67/MMBTU.
  • Power prices have not sold off as hard as natural gas prices but the relentless chatter about the Super El Nino creating a blast furnace warm winter continues to motivate selling across the winter strip and into Calendar/2027.
  • The fall outage season is still running strong with almost 70,000 MW out for maintenance after a strong summer of sustained operations by many PJM generating assets.
  • Even with the increased power demand natural gas spot prices have been sub $1.50/MMBTU in the northeast which has lowered coal generation.

Forward Pricing

Renewable Energy