Energy Wholesale Market Review, 03 July 2020

• Day-ahead power fell 4.6% to £26.00/MWh, following rising levels of wind generation towards the end of the week.
• August 20 power gained 2.3% to £32.10/MWh and the September contract rose 2.0% to £34.99/MWh.

• Q420 power lifted 1.6% to £43.05/MWh.
• The annual October 20 contract rose 2.5% to £43.25/MWh, 15.0% lower than the same time last year (£50.91/MWh).

Forward curve comparison

Annual October Contract

• Day-ahead peak power climbed 3.6% to £32.75/MWh, opposing the direction of its baseload counterpart.
• August 20 peak power gained 3.9% to £36.55/MWh, and September 20 peak power rose 12.2% to £39.71/MWh.

• Annual October 20 peak power lifted 3.6% to £49.61/MWh.
• This is 14.2% lower than the same time last year (£57.81/MWh).

Forward curve comparison

Annual October contract

Seasonal baseload power contracts

Seasonal baseload power curve

• Seasonal power contracts rose by 3.6% on average.
• Winter 20 lifted 1.2% to £45.25/MWh and summer 21 jumped 4.0% to £45.25/MWh.

• All seasonal peak power contracts climbed this week, up 3.4% on average.
• Winter 20 peak power gained 3.5% to £53.83/MWh and summer 21 peak power increased 3.7% to £45.39/MWh.

Oil and Coal

Carbon

• Brent crude oil was little changed on average this week, slipping 0.2% to average $41.89/bl.
• Oil prices started the week at $40.75/bl after reaching a 3-month high of $43.82/bl the previous week, amid growing concerns of increasing COVID-19 cases in the US and South America.
• Prices did find support throughout the week climbing to $42.65/bl by Friday morning. Prices were pushed higher as production cuts continued to bite with some OPEC+ members over-complying with their output cut commitments.
• However, gains were limited as global COVID-19 cases continued to rise with the US posting new daily global records of 50,000 and 55,000 new cases on Wednesday and Thursday, respectively.

• API 2 coal prices climbed 3.1% to average $57.84/t this week, reaching a 5-month high of $58.50/t on Thursday.
• EU ETS carbon continued to reach new multi-month highs last week, gaining 6.4% to average €26.58/t.
• On Thursday, EU ETS carbon rose to €27.52/t, its highest level since mid-August 2019, on increased auction activity.

Wholesale price snapshot