Headlines – UK Wholesale Gas and Electricity Prices
Latest news on UK wholesale energy market trends, with weekly, monthly, and yearly price updates on gas and electricity (day-ahead and year-ahead), coal, EUA carbon, UKA carbon, and Brent crude oil, plus key cost movements.
Through the reporting period, almost entirely bearish movements were seen throughout power and gas contracts, with above average temperatures and ample gas supply resulting in lower fuelled generation demand and bearish trends. Day-ahead gas fell 9.9% to 66.93p/th, following minimal fuelled generation demand due to milder temperatures across GB easing gas supply margins. Day-ahead power fell 23.3% to £60.44/MWh, reflecting trends seen across gas demand, due to lower domestic demand, despite losses in wind outturn. January 26 gas was down 5.5% at 71.00p/th, and February 26 gas decreased 6.2% to 70.50p/th. All seasonal gas contracts declined last week, down by 3.6% on average. Summer 26 gas fell by 4.3% to 64.88p/th, while Winter 26 gas dropped 4.8% to 71.10p/th. Most seasonal power contracts declined last week, down on average by 2.0%, as Summer 26 power decreased 2.0% to £66.50/MWh, while Winter 26 power fell 1.5% to £74.83/MWh.
Baseload wholesale electricity price
Forward curve comparison
- Day-ahead power fell 23.3% to £60.44/MWh, following a period of mild, above seasonal average temperatures, resulting in a decrease in demand for fuelled generation.
- January 26 power decreased 6.0% to £78.75/MWh and February 26 power fell by 5.4% to £77.50/MWh.
Annual October contract
- Q126 power moved 5.0% lower to £75.40/MWh.
- The annual April 26 contract lost 1.8% to £70.67/MWh, a marginal 0.2% higher than the same time last year (£70.50/MWh).
Peak wholesale electricity price
Forward curve comparison
- Day-ahead peak power was down 15.4% to £83.80/MWh, following the bearish trend in its baseload counterpart.
- January 26 peak power declined by 5.3% to £77.50/MWh, and February 26 peak power decreased 5.5% to £95.75/MWh.
Annual October contract
- Annual April 26 peak power rose 1.8% to £75.01/MWh.
- This is 3.46% higher than the same time last year (£72.50/MWh).
Seasonal power prices
Seasonal baseload power contracts
- All seasonal power contracts declined last week, down on average by 2.0%.
- Summer 26 power decreased 2.0% to £66.50/MWh, while Winter 26 fell 1.5% to £74.83/MWh.
Seasonal peak power curve
- Most seasonal peak power contracts declined last week, down 2.0% on average.
- Summer 26 and Winter 26 peak power fell by 1.9% and 1.3% respectively, falling to £68.60/MWh and £91.03/MWh.
Commodity price movements
Oil and coal
- The average price of Brent crude oil increased week-on-week, seeing a low of $62.85/bl on 2 December before reaching a weekly peak of $63.96/bl on 3 December.
- The bullish trend follows increasing geopolitical instability, amid further targeting of Russia’s energy infrastructure by Ukraine, and increasing doubts regarding a successful Russia-Ukraine peace deal.
- It was reported that oil depots in Russia had been targeted, with a stalemate in peace negotiations dampening expectations that Russian oil will return to the global market any time soon.
- Saudi Aramco also made the decision to further lower the price of its crude oil for Asian buyers, reaching its lowest price since early 2021 following the COVID-19 oil crash.
- Long-term market forecasts by JP Morgan note that Brent crude oil prices could fall to the $30/bl by 2027 due to ongoing global supply glut as supply outpaces demand growth.
Carbon (UK and EU ETS)
- EU ETS saw a 0.2% increase last week, to an average of €82.06/t, whilst UK ETS saw a decrease of 2.4%, with a weekly average price of £56.49/t.
- Across the carbon markets, mixed movements were seen throughout the reporting period, with EU ETS carbon seeing minor gains while UK ETS carbon saw losses, dropping to a monthly low of £56.16/t on 5 December.
- Losses across the UK ETS were supported by mild weather conditions throughout GB, limiting stronger demand for more carbon intensive forms of power generation.
- The European Commission confirmed that the cap on non-aviation emissions under the EU ETS will decrease by 8.7% across 2026 compared to the levels seen in 2025.
- Total allowances for power, heat generation, industry, and maritime sit at 1,185 million tonnes, down 113 million tonnes from 2025. This will act to tighten the market and push prices up across 2026.
Wholesale price snapshot – Friday-on Friday
Analysis provided by: Cornwall Insight