Does natural gas fuel price cause system marginal price, vice-versa, or neither? A causality analysis

▸The causal relationship between LNG fuel price for generation and wholesale power price is investigated. ▸ We apply unit-root and co-integration tests, as well as error-correction modeling. ▸ There is a unidirectional causality running from LNG fuel price to wholesale electricity price. ▸ An increase in LNG fuel price directly affects wholesale power price.