Headlines – UK Wholesale Gas Prices and Wholesale Electricity Prices
Almost all tracked power and gas contracts increased last week, with the day-ahead power contract the only exception. Day-ahead power slipped 0.5% to £69.88/MWh. Day-ahead power prices were much lower throughout the week compared to the week prior, with a significant increase in wind generation. In contrast, day-ahead gas rose 6.6% to 108.53p/th, with lower temperatures resulting in higher demand for heating. Larger gains were prevented by a notable drop in gas-fired generation as a result of the increased wind generation seen during the week. January 25 gas climbed 6.4% to 109.25p/th, and February 25 gas gained 6.1% to 109.83p/th. Longer-term gas prices were supported by concerns of future supply across Europe after Vladimir Putin announced that the current deal for the transit of Russian gas through Ukraine will not be renewed once it ends on 31 December 2024. All seasonal gas contracts increased last week, up by 5.0% on average, with summer 25 and winter 25 gas lifting 7.0% and 4.9% to 105.15p/th and 103.90p/th, respectively. This trend extended to baseload power, with all seasonal power contracts moving higher last week, up on average by 4.0%. Summer 25 power rose 5.1% to £80.10/MWh, and winter 25 power gained 3.7% to £85.00/MWh.
Baseload wholesale electricity price
Forward curve comparison
- Day-ahead power fell 0.5% to £69.88/MWh, pushed lower by strong levels of wind generation.
- January 25 power rose 3.5% to £93.50/MWh and February 25 power lifted 2.9% to £93.00/MWh.
Annual October contract
- Q125 power moved 4.6% higher to £91.50/MWh.
- The annual April 25 contract climbed 4.4% to £82.55/MWh, 4.0% lower than the same time last year (£86.00/MWh).
Peak wholesale electricity price
Forward curve comparison
- Day-ahead peak power was down 16.4% to £88.50/MWh, following its baseload counterpart lower.
- January 25 peak power increased 3.0% to £110.50/MWh, and February 25 peak power rose 3.4% to £110.50/MWh.
Annual October contract
- The annual April 25 peak power lifted 3.8% to £85.95/MWh.
- This is 1.0% lower than the same time last year (£86.83/MWh).
Seasonal power prices
Seasonal baseload power contracts
- All seasonal power contracts rose last week, up on average by 4.0%.
- Summer 25 power gained 5.1% to £80.10/MWh, while winter 25 power increased 3.7% to £85.00/MWh.
Seasonal peak power curve
- All seasonal peak power contracts moved higher last week, up 3.8% on average.
- Summer 25 and winter 25 peak power climbed 4.8% and 2.8% respectively, rising to £85.60/MWh and £98.50/MWh.
Commodity price movements
Oil and coal
- Across the week, Brent crude oil observed slightly bullish movements in price, averaging 0.5% higher at $73.25/bl.
- Data from the US Energy Information Administration showed that US crude oil stocks declined by 934,000 barrels in the week ending 13 December, helping to push prices higher.
- Prices were also supported on Friday by news that the Druzhba pipeline had been offline since Thursday due to technical issues. The pipeline delivers Russian and Kazakh oil to a number of European countries with a maximum flow of 2mn barrels per day.
- These bullish factors outweighed fears that weak economic activity could see oil demand reduce in 2025.
- These fears stemmed from warnings that the US Central Bank will be more cautious about cutting rates next year, while interest rates in England and Japan were kept unchanged by their respective national banks.
- Alongside this, the US Dollar rose to a two-year high therefore making oil more expensive for buyers using other currencies.
Carbon (UK and EU ETS)
- Both UK and EU ETS carbon prices saw losses last week. EU ETS carbon prices fell 1.6% to average €65.64/t, and the UK ETS carbon lost 1.7% to average £33.89/t reaching the lowest level seen since February 2024 at £33.43/t on 16 December.
- Demand for carbon allowances both in Europe and the UK saw a downturn with an abundance of renewable generation seen across central Europe and a sharp rise in wind generation in the UK.
- The expiry of the December auctions over the Christmas period for the UK ETS happened on 11 December, and the last auction date for the EU ETS happened on 12 December.
- From the start of 2025, the beginning of a new trading year will buoy prices in the short-term, with the effect of this likely affected by weather conditions, and wind generation projections at the time.
Wholesale price snapshot – Friday-on Friday
