In the first week of June, prices in most European electricity markets increased compared to the previous week. Germany registered the highest price since the end of November 2023, €235.52/MWh, on June 4 from 20:00 to 21:00. The increases were largely driven by the general decline in wind energy production. Despite the increases, most markets registered negative prices for some hours. Photovoltaic energy registered daily production records for a June month in Germany, Italy and Portugal, and the third highest value in history in Spain. On June 3, TTF gas futures reached their highest settlement price since the first half of December. However, the weekly gas average was lower, as was CO2.
Solar photovoltaic, solar thermoelectric and wind energy production
In the first week of June, solar energy production increased compared to the previous week in the German, French and Italian markets, by 37%, 32% and 9.6%, respectively. However, in the Iberian Peninsula, there were decreases, of 22% in Portugal and 12% in Spain. In the case of Spain, solar energy production includes solar photovoltaic energy and solar thermoelectric energy.
Despite a decline in weekly production in Spain, on June 4, photovoltaic energy registered the third highest production ever in this market, 187 GWh. In the first week of the month, Germany, Italy and Portugal registered the highest daily production for a June month in history. In Germany and Italy this happened on June 6, with 362 GWh and 128 GWh, respectively. Portugal reached this milestone on June 3, with 20 GWh produced using this technology.
According to AleaSoft Energy Forecasting’s solar energy production forecasts for Germany, Spain and Italy, in the second week of June it will be lower than in the first week of the month.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
In the week of June 3, wind energy production decreased across the board in the main European electricity markets compared to the previous week. France, Portugal and Italy registered the largest declines, 58%, 55% and 35% in each case. Germany and Spain registered smaller declines, 5.0% and 20%, respectively.
In the week of June 10, according to AleaSoft Energy Forecasting’s wind energy production forecasts, production using this technology will recover in most analyzed markets, although in Spain it will fall again compared to the previous week.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
Electricity demand
In the first week of June, electricity demand decreased in most major European electricity markets compared to the last week of May. Declines ranged from 0.3% in Italy to 5.6% in the Netherlands. The markets where demand increased were Portugal, up 8.7%, Germany, up 4.1%, and Spain, up 2.1%. In Portugal and Germany, the recovery in demand following the celebration of Corpus Christi on May 30 favored the increases.
During the week, average temperatures increased compared to the previous week in markets located further south. Increases ranged from 0.4 °C in Portugal to 1.8 °C in France and Italy. In the rest of the main European electricity markets, average temperatures decreased, ranging from 0.3 °C in Germany to 1.5 °C in the Netherlands.
According to AleaSoft Energy Forecasting’s demand forecasts, in the week of June 10, it will increase compared to the previous week in Belgium, Italy, Great Britain and Portugal, and it will decrease in Spain, Germany, France and the Netherlands.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE, TERNA, National Grid and ELIA.
European electricity markets
In the first week of June, prices in most major European electricity markets increased compared to the previous week. The exceptions were the Nord Pool market of the Nordic countries and the N2EX market of the United Kingdom, with decreases of 1.2% and 16%, respectively. In contrast, the MIBEL market of Spain and Portugal reached the largest percentage price rises, 261% and 269%, respectively. The EPEX SPOT market of France followed them, with an increase of 128%. In the other markets analyzed at AleaSoft Energy Forecasting, prices rose between 4.3% in the EPEX SPOT market of the Netherlands and 16% in the EPEX SPOT market of Belgium.
In the first week of June, weekly averages exceeded €65/MWh in most analyzed European electricity markets. The exceptions were the Nordic and French markets, with averages of €27.26/MWh and €36.86/MWh, respectively. In contrast, the IPEX market of Italy registered the highest weekly average, €107.73/MWh. In the rest of the analyzed markets, prices ranged from €65.90/MWh in the Belgian market to €78.40/MWh in the German market.
Regarding hourly prices, despite the increases in weekly average prices, most analyzed European markets registered negative prices on Sunday, June 9, a day with lower demand and higher wind energy production in some cases. The exception was the Italian market, which continued without negative prices in the first week of June. The German, Belgian, British, Dutch and Nordic markets also reached negative prices on Saturday, June 8. In the case of the French market, in addition to the weekend, there were negative prices on June 4 and 5. The Belgian market registered the lowest hourly price of the first week of June, ?€58.97/MWh, on Sunday, June 9, from 13:00 to 14:00.
On the other hand, on June 3 and 4, from 20:00 to 21:00, the German market reached prices above €200/MWh. On Tuesday, June 4, the price in that hour, €235.52/MWh, was the highest since the end of November 2023 in this market.
During the week of June 3, the general decline in wind energy production had an upward influence on European electricity market prices. In addition, demand increased in some markets such as Germany, Spain and Portugal. The fall in solar energy production in the Iberian Peninsula also contributed to the rise in prices in the MIBEL market.
AleaSoft Energy Forecasting’s price forecasts indicate that prices of most analyzed European electricity markets might decrease in the second week of June, influenced by the increase in wind energy production in most markets and the decrease in demand in some cases.
Source: Prepared by AleaSoft Energy Forecasting using data from OMIE, EPEX SPOT, Nord Pool and GME.
Brent, fuels and CO2
In the first sessions of the first week of June, Brent oil futures prices for the Front?Month in the ICE market continued the downward trend of the previous week. As a result, on Tuesday, June 4, these futures registered their weekly minimum settlement price, $77.52/bbl. According to data analyzed at AleaSoft Energy Forecasting, this price was the lowest since February 3. However, on Wednesday, prices began to recover and on Thursday, June 6, futures reached their weekly maximum settlement price, $79.87/bbl. After a slight pullback of 0.3%, on Friday, June 7, the settlement price was $79.62/bbl, down 2.5% from the previous Friday. The weekly average settlement price was 5.0% lower than the week of May 27.
In the first week of June, demand concerns continued to exert their downward influence on Brent oil futures prices. Despite the OPEC+ agreement to maintain its production cuts until the end of 2025, the abundance in supply kept prices below $80/bbl in the first week of June.
As for TTF gas futures in the ICE market for the Front?Month, on Monday, June 3, they reached the weekly maximum settlement price, €36.01/MWh. According to data analyzed at AleaSoft Energy Forecasting, this price was the highest since December 12, 2023. Subsequently, prices started a downward trend. As a result, on Friday, June 7, these futures registered their weekly minimum settlement price, €33.11/MWh.
The interruption in supply from a Norwegian plant caused prices to rise at the beginning of the first week of June. However, the reestablishment of supply contributed to the week?on?week decline in prices, which was 1.2%.
Regarding CO2 emission allowance futures in the EEX market for the reference contract of December 2024, on Monday, June 3, they reached their weekly maximum settlement price, €74.57/t. However, in most sessions of the first week of June, these futures registered price declines. On Friday, June 7, they registered their weekly minimum settlement price, €71.39/t. According to data analyzed at AleaSoft Energy Forecasting, this price was 3.7% lower than the previous Friday and the lowest since May 18. The decline in the weekly average settlement price compared to the previous week was 3.2%.
Source: Prepared by AleaSoft Energy Forecasting using data from ICE and EEX.
AleaSoft Energy Forecasting’s analysis on the prospects for energy markets in Europe and the renewable energy projects financing
On Thursday, June 13, AleaSoft Energy Forecasting and AleaGreen will hold the 45th webinar in their monthly webinar series. This webinar will analyze the evolution of European energy markets and the prospects in the second half of 2024, the growth opportunities in the renewable sector, the regulatory and design challenges of the wholesale market and the current affairs of the PPA market in Spain. On this occasion, the webinar will feature speakers from Engie Spain, for the sixth time in the monthly webinar series.
