AleaSoft Energy Forecasting, September 18, 2023. In the second week of September, European electricity markets prices rose compared to the previous week. On the 11th, some markets registered hourly prices above €300/MWh, the highest since December. The increase was driven by higher demand and gas prices, as well as lower renewable energy production in some markets. On the 15th, Brent futures registered the highest price since the first half of November 2022.
Solar photovoltaic and thermoelectric energy production and wind energy production
In the week of September 11, solar energy production decreased in almost all analyzed markets compared to the previous week. The French market registered the largest drop, 27%. In the other markets, the decline in solar energy production ranged from 14% in Spain to 21% in Germany. The Portuguese market was the exception to this trend, with a week‑on‑week increase of 12% and 13 GWh generated on September 13, which is the highest value since the beginning of the current month.
For the week of September 18, according to AleaSoft Energy Forecasting’s solar energy production forecasts, a decrease is expected in all analyzed markets, with the exception of the Spanish market.
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.
As for wind energy production, the week of September 11 brought a week‑on‑week decline in most of the markets analyzed at AleaSoft Energy Forecasting. The smallest declines, 3.0% and 5.6%, were registered in the Spanish and German markets, respectively. On the other hand, the largest decline, 84%, was observed in the Italian market. The exception to this trend was again the Portuguese market, where wind energy production increased by 16%.
For the week of September 18, AleaSoft Energy Forecasting’s wind energy production forecasts indicate that wind energy production will increase in all analyzed markets except Portugal.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
Electricity demand
In the week of September 11, the evolution of electricity demand compared to the previous week did not show a homogeneous trend in all analyzed markets. Demand increased in some markets, ranging from 0.9% in Germany and Portugal to 4.8% in the Netherlands. Other markets showed the opposite trend, with demand falling between 0.9% in Spain and 2.6% in France.
However, the average temperature in all analyzed countries decreased compared to the previous week during the same period. The largest temperature decrease was registered in Northern European countries. The United Kingdom led the way with a drop of 5.1 °C, followed by the Netherlands and Belgium with decreases of 3.7 °C and 3.0 °C, respectively. In the rest of the analyzed countries, the temperature decrease ranged from 0.9 °C in Italy to 2.9 °C in France.
For the current week of September 18, according to AleaSoft Energy Forecasting’s demand forecasts, electricity demand is expected to fall in most of the analyzed European markets, with the exception of the United Kingdom, the Netherlands and Portugal.
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 September 11, prices in all European electricity markets analyzed at AleaSoft Energy Forecasting increased compared to the previous week. The largest price rise of 16% was reached in the EPEX SPOT market of Germany, the IPEX market of Italy and the Nord Pool market of the Nordic countries. On the other hand, the smallest increase, 1.9%, was registered in the MIBEL market of Portugal. In the other markets, prices rose between 2.1% in the Spanish market and 13% in the Dutch market.
In the second week of September, weekly averages were above €95/MWh in almost all European electricity markets. The exception was the Nordic market, with the lowest average of €20.15/MWh. On the other hand, the highest average price, €124.12/MWh, was that of the Italian market. In the rest of the analyzed markets, prices ranged from €97.01/MWh in the French market to €115.10/MWh in the German market.
Regarding hourly prices, on Monday, September 11, from 20:00 to 21:00, a price of €330.36/MWh was registered in the Belgian market, which was the highest in this market since December 20, 2022. On the same day, from 19:00 to 20:00, in the Dutch and German markets, prices were €463.77/MWh and €524.27/MWh respectively, the highest ones in both markets since December 16, 2022. On the other hand, on Monday, September 18, from 23:00 to 24:00, a price of €0.29/MWh was registered in the Nordic market, the lowest since the first half of August.
During the week of September 11, a higher average gas price, lower wind and solar energy productions in most of the analyzed markets and the increase in demand in some markets led to higher prices in the European electricity markets.
AleaSoft Energy Forecasting’s price forecasts indicate that in the third week of September prices might fall in European electricity markets, influenced by increased wind energy production, as well as lower demand in some markets.
Source: Prepared by AleaSoft Energy Forecasting using data from OMIE, EPEX SPOT, Nord Pool and GME.
Brent, fuels and CO2
In the second week of September, the settlement prices of Brent oil futures for the Front‑Month in the ICE market exceeded $90/bbl. On Monday, September 11, they registered the weekly minimum settlement price of $90.64/bbl, which was 1.8% higher than the previous Monday. The weekly maximum settlement price of $93.93/bbl was reached on Friday, September 15. This price was 3.6% higher than the previous Friday and the highest since the first half of November 2022.
In the second week of September, production cuts of Saudi Arabia and Russia continued to exert their upward influence on Brent oil futures prices. The prospects for recovery in the Chinese economy also contributed to price increases.
As for the settlement prices of TTF gas futures in the ICE market for the Front‑Month, they remained above €35/MWh almost every day of the second week of September. The weekly minimum settlement price, €34.70/MWh, was registered on Tuesday, September 12. But this price was already 0.7% higher than that of the previous Tuesday. After an increase of 6.1% over Tuesday, the weekly maximum settlement price, €36.82/MWh, was reached on September 13, and was 18% higher than that of the same day of the previous week. In the last session of the week, the settlement price also exceeded €36/MWh. On Friday, September 15, a value of €36.48/MWh was registered, which was 5.7% higher than the previous Friday.
In the second week of September, concerns about the impact on liquefied natural gas supply from the labor dispute at Australian export plants exerted an upward influence on prices. In addition, the decline in the flow from Norway was larger than expected.
Regarding settlement prices of CO2 emission rights futures in the EEX market for the reference contract of December 2023, during the second week of September, they remained below €84/t. The weekly minimum settlement price, €81.08/t, was registered on Tuesday, September 12. This price was 3.3% lower than the previous Tuesday and the lowest since early June. On the other hand, on Thursday, September 14, the weekly maximum settlement price, €83.12/t, was reached and was 0.2% higher than the previous Thursday.
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 financing and valuation of renewable energy projects
In the September webinar of the monthly webinar series of AleaSoft Energy Forecasting and AleaGreen, in addition to the prospects for European energy markets and the AleaSoft Energy Forecasting services for risk management and energy transition, the benefits of renewable PPA for large and electro‑intensive consumers were analyzed. For that purpose, Pedro González, Director‑General of AEGE, and Jaime Vázquez, PPA Director at Econergy Renewables, participated in the analysis table of the Spanish version of the webinar.
AleaGreen’s long‑term price forecasts are essential for all parties involved in signing a PPA. AleaGreen offers solutions adapted to the needs of large and electro‑intensive consumers, sponsors, developers and investors in renewable energies, contributing also in the search for counterparties.
A new webinar will be held on Thursday, October 19, with the participation, for the fourth time, of speakers from Deloitte. On this occasion, the prospects for European energy markets for the winter 2023‑2024, the financing of renewable energy projects and the importance of forecasting in audits and portfolio valuation will be analyzed.
Source: AleaSoft Energy Forecasting.
