Energy Wholesale Market Review, 17 May 2019

Baseload electricity

• Day-ahead power fell 12.6% to £40.9/MWh.
• The June 2019 contract slipped 4.8% to £41.4/MWh and July 19 power lost 5.0% to £41.5/MWh.

• Annual October 19 power declined 1.1% week-on-week to £53.2/MWh.
• The contract is 4.6% lower than the same time last month (£55.7/MWh).

Forward curve comparison

Annual April Contract

Peak electricity

• Day-ahead peak power dropped 11.7% to £43.3/MWh, £2.4/MWh above its baseload counterpart.
• Day-ahead peak power is 6.5% lower than the same time last year when it was £46.3/MWh.
• June and July 19 peak power lost 4.1% and 4.6% to £45.5/MWh and £45.8/MWh, respectively.

• Annual October 19 peak power slipped 0.7% to end the week at £59.1/MWh, £5.9/MWh above its baseload power counterpart.
• The contract is 3.6% below its value this time last month (£61.3/MWh), and 2.6% above the same time last year when it was £57.6/MWh.

Forward curve comparison

Annual April contract

Seasonal power prices

Seasonal baseload power contracts

Seasonal baseload power curve

• Seasonal power contracts lost 0.2% on average.
• Winter 19 power dropped 1.0% to £57.8/MWh.
• Summer 20 power fell 1.2% to £48.5/MWh.

• Seasonal peak power contracts dropped 0.3% on average, with winter 19 peak power losing 0.7% to £65.0/MWh.
• On average, seasonal peak power contracts are 3.4% lower month-on-month.

Commodity price movements

Oil and Coal 

Carbon

• • Brent crude oil prices reversed last week’s losses, gaining 2.0% to average $71.7/bl.
  • Prices were supported by increased concerns of potential conflict and supply disruption in the Middle East, following a number of incidents in the region.
  • On Sunday 12 May, four oil tankers were attacked near the Strait of Hormuz, while oil installations in Saudi Arabia were targeted by drone attacks on Tuesday.
  • API 2 coal prices lost 0.3% to average $70.2/t.
  • Coal prices continued to be pressured by low gas prices and high coal stocks in Europe.

• EU ETS carbon prices dropped 2.8% to average €25.7/t.
• Carbon prices were pushed lower by decreasing coal demand and weak auction results towards the end of the week.
• Prices were pressured further after RWE, Europe’s largest buyer of carbon, announced an improved carbon hedging position compared to the same time last year.

Wholesale price snapshot