Alberta electricity & gas market update – January 2026

Electricity market overview

January’s average AESO spot price fell 1.57% MoM, but rose 29.9% YoY. This rise reflects elevated winter heating demand and periods of market volatility, with sharp price spikes during cold snaps, alongside continued episodes of renewable-driven oversupply pushing prices lower in certain hours.

Average AESO Pool Price: $39.44/MWh

Monthly Price Range

• Peak hourly price: $858.44/MWh, recorded on December 12th
• Minimum hourly price: $0.00MWh
• Demand Highlights: Monthly peak demand at 12,291 MW

Key drivers of market volatility

• Upcoming maintenance at major facilities will temporarily reduce available electricity supply. Historically, such events have led to notable price spikes, as seen during the coal-to-gas conversions in 2019.
• Recent mild temperatures have lowered electricity demand, resulting in softer market prices and creating opportunities for businesses to lock in favorable rates.
• Weather forecasts indicate a return to colder conditions, which will drive electricity demand higher and likely push prices up, making early rate planning advantageous.

Natural gas (AECO) market overview

Average AECO Price: $2.77/GJ

AECO declined 9.2% MoM but remained 39.5% higher YoY, supported by stronger fundamentals versus last winter. Elevated storage withdrawals and processing outages sustained volatility, with forward sentiment remaining constructive into spring.

Forward curve indicators

• ~$2.86/GJ – Winter 2027 Peak Futures
• ~$3.20/GJ – Winter 2028 Peak Futures
• ~$3.30/GJ – Winter 2029 Peak Futures

Market insights & trends

• Cold weather forecasts are expected to increase heating demand, supporting near-term natural gas withdrawals and price volatility.
• Steady export flows into the U.S. Midwest continue to underpin AECO pricing despite elevated storage levels.
• Ongoing industrial and infrastructure investment in Alberta reinforces longer-term natural gas demand expectations.

Recent pricing patterns highlight how quickly Alberta’s energy landscape can shift, from renewable-driven price suppression to weather-driven spikes within days. For businesses managing budgets, this volatility is not just a market headline; it directly impacts forecasting, procurement timing, and risk exposure. A clear strategy, aligned with both short-term conditions and long-term trends, is becoming increasingly important.

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