Energy Wholesale Market Review, 12 March 2021

• Day-ahead power remained at £67.00/MWh, as varying wind generation influenced power prices throughout the week, before a £20.00MW/h increase on 12 March.
• April 21 power climbed 10.3% to £56.92/MWh and May 21 power increased 10.6% to £55.59/MWh.

• Q221 power moved 10.1% higher to £56.16/MWh.
• The annual April 21 contract rose 8.1% to £60.29/MWh, 42.2% higher than the same time last year (£42.4/MWh).

Forward curve comparison

Annual April Contract

• Day-ahead peak power was up 2.6% to £80.00/MWh, benefitting from increased low wind output forecast next week.
• April 21 peak power declined 14.5% to £46.58/MWh, and May 21 peak power decreased 19.5% to £43.85/MWh.

• The annual April 21 peak power contract lost 20.7% to £49.3/MWh.
• This is 3.5% lower than the same time last year (47.62/MWh).

Forward curve comparison

Annual April contract

Seasonal baseload power contracts

Seasonal baseload power curve

• All seasonal power contracts climbed this week, up on average by 5.6%.
• Summer 21 and winter 21 rose 9.9% and 6.7% respectively, rising to £55.78/MWh and £64.80/MWh.

• All seasonal peak power contracts declined this week, down 21.4% on average.
• Summer 21 and winter 21 peak power dropped 18.8% and 22.2% respectively, falling to £44.55/MWh and £54.04/MWh.

Oil and Coal

Carbon

• Brent crude oil prices rebounded this week, up 6.0% to average $68.83/bl.
• Demand recovery optimism and positive economic forecasts represented the primary drivers for Brent crude oil prices this week. Demand recovery in the aftermath of Coronavirus has continued to generate concern among the market however, there are recent reports that recovery looks more promising than initially projected.
• Meanwhile, API 2 coal fell 1.5% from the previous week to average $68.34/t.

• EU ETS carbon prices rose 8.4% to average €40.77/t. Prices reached a new all-time high of €42.42/t on 11 March.
• Prices may be weighed upon by warmer weather expected in the UK and Europe at the early part of next week.
• However, temperatures are forecast to drop notably beyond this which may counteract bearish price movements in the weeks start.

Wholesale price snapshot