Second consecutive week of price falls in most European electricity markets.
In the fourth week of February, prices of most European electricity markets fell compared to the previous week, influenced by the decrease in gas prices and the drop in demand in various European markets. On the other hand, on February 21, TTF gas futures for the Front?Month registered a settlement price of €48.54/MWh, the lowest since August 2021. On the other hand, that day CO2 futures for December reached a historical maximum settlement price of €100.34/t.
Solar photovoltaic and thermoelectric energy production and wind energy production
During the fourth week of February, the solar energy production increased compared to the previous week in most European markets analysed at AleaSoft Energy Forecasting. The largest rise was that of the German market, of 13%, while in the Portuguese and Spanish markets the increases were 7.1% and 4.7%, respectively. On the other hand, the solar energy production decreased by 25% in the French market and by 34% in the Italian market.
For the first week of March, the AleaSoft Energy Forecasting’s solar energy production forecasting indicates that the production might increase in Germany, Spain and Italy.
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.
During the week of February 20, the wind energy production increased compared to the previous week in Germany and Spain. The largest rise, of 15%, was that of the German market, while in the Spanish market it increased by 5.3%. However, the production with this technology decreased in France, Italy and Portugal by 2.1%, 3.3% and 58%, respectively.
For the week of February 27, the AleaSoft Energy Forecasting’s wind energy production forecasting indicates a possible increase in Spain, Italy and Portugal, but decreases might be registered in the German and French markets.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
Electricity demand
In the week of February 20, the electricity demand decreased in almost all European markets analysed at AleaSoft Energy Forecasting compared to the previous week. The exceptions were the British and Dutch markets, with increases of 2.8% and 3.2%, respectively. On the other hand, the largest decrease, of 3.8%, was registered in the Italian market. In the rest of the markets, the demand decreased between 0.6% of the Belgian market and 2.9% of the Spanish market.
In the case of the Italian market, in the fourth week of February, average temperatures increased by 1.9 °C compared to those registered during the previous week, allowing the largest decrease in electricity demand to be registered in this market.
For the week of February 27, according to the demand forecasting made by AleaSoft Energy Forecasting, increases are expected in almost all European markets, influenced by the general decrease in average temperatures.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE, TERNA, National Grid and ELIA.
European electricity markets
In the week of February 20, prices of most European electricity markets analysed at AleaSoft Energy Forecasting fell compared to the previous week. The exceptions were the Nord Pool market of the Nordic countries, the MIBEL market of Portugal and the EPEX SPOT market of France, with increases of 0.1%, 0.2% and 1.1%, respectively. On the other hand, the largest drop in prices, of 12%, was that of the EPEX SPOT market of Germany. In the rest of the markets, the decreases were between 0.5% of the N2EX market of the United Kingdom and 4.0% of the EPEX SPOT market of the Netherlands.
In the fourth week of February, the highest average price, of €153.39/MWh, was that of the IPEX market of Italy, followed by the average of the British market, of €146.73/MWh. On the other hand, the lowest weekly average was that of the Nordic market, of €79.91/MWh. In the rest of the analysed markets, prices were between €113.72/MWh of the German market and €141.85/MWh of the French market.
In the case of the Spanish market, the price was €134.69/MWh, 2.5% lower than that of the previous week. When taking into account the adjustment that some consumers have to pay due to the gas price limitation in this market, in the fourth week of February an average of €133.51/MWh was registered.
Regarding hourly prices, on Sunday, February 26, from 14:00 to 15:00, a price of €55.84/MWh was registered in the French market and a price of €62.46/MWh, in the Italian market. These prices were the lowest in these markets since mid?January. In the case of the Spanish market, that day from 15:00 to 17:00, an even lower price was reached, of €4.16/MWh, which was the lowest since January 18. On the other hand, in the Nordic market, on February 21 from 18:00 to 19:00 a price of €167.33/MWh was reached, the highest since January 19.
Regarding daily prices, in the MIBEL market of Spain and Portugal, the highest price since December 6, 2022, of €151.43/MWh, was reached on Tuesday, February 21. On the other hand, on Sunday, February 26, a price of €125.54/MWh was registered in the Italian market, the lowest in this market since November 6, 2022. In the case of the German, Dutch and British markets, on February 20 the lowest prices since January 15 were registered, of €61.42/MWh, €97.34/MWh and €125.16/MWh, respectively.
During the week of February 20, the decrease in gas prices compared to the previous week, as well as the drop in electricity demand in many European markets, led to a decrease in prices in most analysed markets, despite the increase in CO2 emission rights prices. This behaviour was also favoured by the increase in wind and solar energy production in countries such as Germany and Spain.
The AleaSoft Energy Forecasting’s price forecasting indicates that in the first week of March prices might increase in most European electricity markets, influenced by the increase in demand in almost all markets and the decrease in wind energy production in markets such as the German and the French.
Source: Prepared by AleaSoft Energy Forecasting using data from OMIE, EPEX SPOT, Nord Pool and GME.
Brent, fuels and CO2
Brent oil futures for the Front?Month in the ICE market began the fourth week of February with a price rise compared to the last session of the previous week. Thus, on Monday, February 20, the weekly maximum settlement price, of $84.07/bbl, was reached. However, this price was 2.9% lower than that of the previous Monday. In the same way, lower settlement prices than those of the same days of the previous week were registered on most days of the fourth week of February. The weekly minimum settlement price, of $80.60/bbl, was registered on Wednesday, February 22, and it was 5.6% lower than that of the same day of the previous week. But, in the last sessions of the week, prices recovered. As a result, on Friday, February 24, a settlement price of $83.16/bbl was registered, 0.2% higher than that of the previous Friday.
The increase in US crude oil reserves and fears about the evolution of the global economy continued to exert their downward influence on Brent oil futures prices in the fourth week of February. However, Russia’s plans to cut its oil production and decrease its exports from western ports in March contributed to the recovery of prices in the second half of the week.
As for TTF gas futures in the ICE market for the Front?Month, on Tuesday, February 21, the weekly minimum settlement price, of €48.54/MWh, was registered. This price was 7.3% lower than that of the same day of the previous week and the lowest since the end of August 2021. But, subsequently, settlement prices remained above €50/MWh. On Friday, February 24, the weekly maximum settlement price, of €51.01/MWh, was registered, which was 4.0% higher than that of the previous Friday. However, except for that day, in the fourth week of February, TTF gas futures settlement prices were lower than those of the same days of the previous week. These prices continued to be influenced downwards by reserve levels above the usual for the season and the abundant supply of liquefied natural gas.
Regarding CO2 emission rights futures in the EEX market for the reference contract of December 2023, they began the fourth week of February with price increases. On Tuesday, February 21, they reached a historical maximum settlement price, of €100.34/t, which, in addition, was 9.0% higher than that of the previous Tuesday. However, on Wednesday, February 22, prices fell to register the minimum settlement price of the week, of €96.77/t. The last days of the fourth week of February, settlement prices remained above €97/t, registering a value of €97.39/t on Friday, February 24, which was 1.2% higher than that of the previous Friday.
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
On Thursday, March 16, the third webinar of 2023 of the series of monthly webinars of AleaSoft Energy Forecasting and AleaGreen will be held. In addition to the prospects for European energy markets for spring 2023, the webinar will analyse the main novelties in the regulation of the Spanish energy sector, the renewable energy projects financing, the importance of PPA and self?consumption, as well as the main considerations to take into account in the portfolio valuation. In the webinar of March, invited speakers from EY will participate for the third time.
On the other hand, Alea Energy DataBase (AleaApp) was developed at AleaSoft Energy Forcasting, an online platform for the compilation, visualisation and analysis of data related to energy markets. The Alea Energy DataBase includes prices and electricity demand of the main European electricity markets. There is also a fuels observatory, where it is possible to consult the time series of gas, oil, coal and CO2 emission rights.
