Energy Wholesale Market Review – 3 March 2023


This week saw the return of some more bearish pricing fundamentals, with all tracked wholesale gas and power contracts in GB registering week-on-week price losses. On-going milder weather and consistent levels of supply via LNG are keeping near-term prices lower, and subsequently influencing the price direction further out on the forward curve. Day-ahead gas fell 9.6% to 122.0p/th, following the continued strong influx of LNG reaching UK landing terminals, easing supply-side strain – coupled with ample European gas storage levels, easing price based risk from traders for the latter stages of this winter. Similarly, day-ahead power fell 7.2% to £136.0/MWh, largely mirroring the losses demonstrated from the wholesale cost of gas. April 23 gas was down 11.0% at 115.0p/th, and May 23 gas decreased 8.5% to 115.75p/th. All seasonal gas contracts declined this week, down by 9.5% on average, while both summer 23 and winter 23 gas dropped 11.0% and 8.7% respectively, subsiding to 117.00p/th and 141.00p/th. Like gas, all seasonal power contracts declined this week, down on average by 6.2%, as summer 23 power decreased 9.3% to £127.0/MWh, while winter 23 power fell 6.3% to £152.7/MWh.

Baseload electricity

Forward curve comparison

  • Day-ahead power fell 7.2% to £136.0/MWh, following day-ahead gas prices lower and the return of some of the British nuclear fleet previously on outage.
  • April 23 power slipped 6.6% to £127.0/MWh and May 23 power decreased 5.3% to £127.0/MWh.

Annual October contract

  • Q223 power moved 8.0% lower to £127.0/MWh.
  • The annual April 23 contract lost 7.7% to £139.8/MWh, 4.2% lower than the same time last year (£146.0/MWh).

Peak electricity

Forward curve comparison

  • Day-ahead peak power was down 6.3% to £145.7/MWh, following baseload power lower.
  • April 23 peak power declined 2.7% to £144.0/MWh, and May 23 peak power decreased 2.3% to £144.5/MWh.

Annual April contract

  • The annual April 23 peak power lost 3.4% to £164.2/MWh.
  • This is 10.6% higher than the same time last year (148.5/MWh).

Seasonal power prices

Seasonal baseload power contracts

  • All seasonal power contracts declined this week, down on average by 6.2%.
  • Summer 23 power decreased 9.3% to £127.0/MWh, while winter 23 power fell 6.3% to £152.7/MWh.

Seasonal baseload power curve

  • Like baseload, all seasonal peak power contracts declined this week, down 3.6% on average.
  • Summer 23 and winter 23 peak power dropped 5.7% and 1.6% respectively, falling to £141.5/MWh and £187.0/MWh.

Commodity price movements

Oil and coal

  • Brent crude oil rose 1.3% on the previous week to average $83.72/bl.
  • Brent crude saw bullish movements during the past seven days, as the Russian supply cuts outweigh future Chinese demand levels.
  • Price rises were limited by rising U.S. crude inventory levels, however.
  • Prices will increase as a result of the complete ban on Russian refined products set in place on 5 February, coupled with the G7 price cap decreasing supply of the resource.

Carbon (UK and EU ETS)

  • Both EU and UK ETS schemes saw their average price this week fall, with a 1.0% decrease to EU ETS carbon (€97.22/t), and UK ETS carbon seeing a 0.1% decline (£83.35/t).
  • Demand for EU Allowance (EUA) certificates has risen rises following the approach of the deadline for 2023 contract settlement. The European Council confirmed this deadline would remain 30 April 2023 to raise funds for the recently adopted RepowerEU plan. By frontloading the ETS, EU ETS prices will remain higher than levels seen earlier in 2022, despite weekly losses.

Wholesale price snapshot – Friday-on Friday

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