Energy Wholesale Market Review, 28 February 2020

• Day-ahead power rose 6.8% to £35.15/MWh with forecasts of lower wind generation and colder weather supporting prices.
• March 20 power climbed 1.1% to £33.50/MWh and April 20 power decreased 3.6% to £32.20/MWh.

• Q220 power moved 4.6% lower to £32.50/MWh.
• The Annual April 20 contract lost 4.5% to £37.45/MWh, 27.7% lower than the same time last year (£51.82/MWh).

Forward curve comparison

Annual October Contract

• Day-ahead peak power was up 6.1% to £38.00/MWh following its baseload counterpart higher.
• March 20 peak power declined 0.4% to £37.35/MWh, and April 20 peak power decreased 3.3% to £35.19/MWh.

• The Annual April 20 peak power lost 5.0% to £42.71/MWh.
• This is 26.6% lower than the same time last year (£58.17/MWh).

Forward curve comparison

Annual October contract

Seasonal baseload power contracts

Seasonal baseload power curve

• All seasonal power contracts declined this week, down on average by 4.0%.
• Summer 20 power decreased 4.7% to £32.75/MWh, while winter 20 fell 4.4% to £42.15/MWh.

• All seasonal peak power contracts declined this week, down £4.7% on average.
• Summer 20 and winter 20 peak power dropped 5.1% and 4.9% respectively, falling to £36.65/MWh and £48.77/MWh.

Oil and Coal

Carbon

• Brent crude oil fell 6.5% to average $53.93/bl as oil prices recorded their largest weekly fall in over 4 years, dropping 10.6% from Monday to Friday.
• Market focus shifted from the drop in Libyan output – which saw prices lift last week, back to the increasing spread of the coronavirus outside of China.
• With the virus having spread to a now estimated 47 countries, there are increasing market concerns over the damage this may do to the future of global oil consumption growth, particularly in large consuming countries such as the US.
• API 2 coal saw further losses this week, falling by 3.6% to average $57.19/t. Coal prices dropped after another turbulent week for the global economy.

• EU ETS carbon lost 3.7% to average €24.04/t this week as prices lost the recent momentum seen in recent weeks, ending the week at €23.33/t.
• Following Brent crude oil, API 2 coal prices and the wider global economy down, further pressure was added to EU ETS prices on the announcement that UK auctions for the ETS would resume on 4 March.

Wholesale price snapshot