Germany's renewable energy output helps cut Europe's energy prices

by Search Gate staff. Published Tue 12 Nov 2013 19:47
Clean energy helps keep the bills down

Day-ahead electricity prices in Continental Europe fell sharply in October, with windy conditions boosting renewable energy output, according to monthly data just released by leading global energy information provider, Platts.

The Platts Continental Power (CONTI) Index fell 10.2% in October to €44.44 per megawatt hour (/MWh) compared to the September rate of €49.49/MWh. Year-over-year the index is down 11.4%.

"German near-term power prices turned bearish in October and into November as strong wind output displaced conventional generation," said Andreas Franke, Platts editor. "German wind output in October was 47% higher than a year ago, while the country's solar panels generated 5.5% more electricity than in October 2015."

Oversupply is not confined to Germany. Despite a slow return to service following maintenance of a number of nuclear reactors in France, the French day-ahead power price in October was down 6% compared to September. Even the "island" system of the U.K. saw the most recent monthly average power prices dip 1% on September.

"October 28's St. Jude's Day storm and high winds saw the lowest U.K. day-ahead price for the month at £45.45/MWh," Franke said. "Since then, rising nuclear output into November has kept a lid on U.K. prices."

Meanwhile, U.K. natural gas prices bucked a recent upward trend and fell in October from September, as mild temperatures capped demand and strong pipeline gas flows from Norway kept the system well supplied.

The day-ahead contract averaged 65.10 pence/therm (p/th) during October, compared to 65.70 p/th in September – a near 1% decline. In 2015 the price rose by 6.34% to 64.35 p/th month-over-month.

"After a late surge, U.K. gas storage levels reached 98.21% of capacity late October," Franke said. "Daily U.K. gas demand in October averaged about 190 million cubic meters, up 23% month-over-month, but down 12% year-over-year."

At Continental Europe's most liquid natural gas trading hub, the Dutch TTF, the average price of day-ahead gas in October was €25.87/MWh, down 2.3% on September and 3% year-over-year. Warmer-than-average temperatures combined with strong Norwegian gas flows to guide prices lower.

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