Energy Wholesale Market Review, 9 July 2021

• Day-ahead power rose 4.9% to £97.0/MWh, continuing its recent bullish run, supported by weak wind output and reduce nuclear availability in parts.
• August 21 power slipped 1.2% at £89.95/MWh and September 21 power decreased 0.4% to £92/MWh.

• Q421 power moved 1.2% higher to £98.75/MWh.
• The annual October 21 contract rose 0.7% to £81.63/MWh, 70.1% higher than the same time last year (£48/MWh).

Forward curve comparison

Annual April Contract

• Day-ahead peak power was up 2.3% to £104.35/MWh, following its baseload counterpart higher.
  August 21 peak power declined 8.5% at £88.89/MWh, and September 21 peak power increased 11.7% to £94.97/MWh.

• The annual October 21 peak power lost 1.0% to £83.5/MWh.
• This is 54.1% lower than the same time last year (54.17/MWh).

Forward curve comparison

Annual April contract

Seasonal baseload power contracts

Seasonal baseload power curve

• Most seasonal power contracts rose this week, up on average by 0.2%.
• Winter 21 and summer 22 expanded 0.9% and 0.4% respectively, rising to £98.50/MWh and £64.75/MWh.

• Most seasonal peak power contracts grew this week, up 0.4% on average.
• Winter 21 gas increased 1.6% to £105.00/MWh, while summer 22 peak power dropped 0.0% to £62.00/MWh.

Oil and Coal

Carbon

• Brent crude oil crept up 0.4% to average $75.46/bl this week. Prices reached a fresh two-year high of $77.32/bl on 6 July.
• Prices this week primarily followed the direction of OPEC+ supply strategy talks. At the week’s start, prices were supported by optimism surrounding the proposed supply strategy for the coming months and trying to resolve UAE opposition of output cuts.
• However, as the week matured – these talks appeared to have broken down and we consequently saw prices fall on consecutive days for the remainder of the week.

• EU ETS carbon prices fell 2.4% to average €55.11/t. Similarly, UK ETS carbon dropped 3.2% to average £45.62/t.
• It was a collectively bearish week for carbon markets this week.
• The primary driver for the downward pressure places on prices was the release of free EUA allocation to industry which persisted into the closing stages of the week.
• Any sustained losses were capped by generally low wind output on the continent.

Wholesale price snapshot