Energy Wholesale Market Review, 25 June 2021

• Day-ahead power rose 8.3% to £88.00/MWh, supported by rising gas prices and forecasts of weak wind generation early next week.
• July 21 power gained 9.2% at £84.00/MWh and August 21 power climbed 9.1% to £83.90/MWh.

• Q321 power jumped 8.7% to £84.73/MWh.
• The annual October 21 contract lifted 7.5% to £76.63/MWh, 70.2% higher than the same time last year (£45.03/MWh).

Forward curve comparison

Annual April Contract

• Day-ahead peak power jumped 14.3% to £94.25/MWh, following trends in its baseload power counterpart.
• July 21 peak power surged 19.2% to £90.30/MWh, and August 21 peak power leapt 16.4% to £89.65/MWh.

• Annual October 21 peak power rose 21.3% to £85.93/MWh.
• This is 68.0% higher than the same time last year (£51.16/MWh).

Forward curve comparison

Annual April contract

Seasonal baseload power contracts

Seasonal baseload power curve

• Most seasonal power contracts rose this week, up by 7.6% on average.
• Winter 21 power climbed 7.4% to £90.75/MWh, while summer 22 power gained 7.6% to £62.50/MWh.

• Seasonal peak power contracts increased 21.1% on average.
• Winter 21 peak power surged 23.1% to £102.95/MWh and summer 22 peak power leapt 18.7% to £68.90/MWh.

Oil and Coal

Carbon

• Brent crude oil lifted 1.7% to average $74.85/bl, reaching $75.57/bl on 23 June, its highest price since November 2018.
• Oil prices were supported by a drop in the volumes of oil held in US crude stocks, in addition to fresh doubts that the US will lift sanctions on Iranian oil exports.
• Further signs of demand recovery, such as an increase in German economic activity, also helped push prices higher. However, some uncertainty remains on whether OPEC+ will agree to ease output cuts further when it meets on 1 July.

• EU ETS carbon prices rose 4.2% to average €54.06/t. Similarly, UK ETS carbon gained 1.8% to average £45.90/t.
• Both markets were supported by the tight gas market and rising oil prices. However, gains were somewhat capped by uncertainty around the number of fresh EU ETS allowances that may enter the market once participants receive their free allocations later this month.

Wholesale price snapshot