AleaSoft Energy Forecasting, July 15, 2024. In the second week of July, prices in the main European electricity markets rose compared to the previous week. These increases were favored by the drop in wind energy production and the increase in temperatures, which caused demand to rise in most markets. Almost all markets registered negative prices in some hours. Solar energy production increased in all markets and photovoltaic energy production registered historical records in Spain and Portugal, and records for a July month in France and Germany.
Solar photovoltaic, solar thermoelectric and wind energy production
In the week of July 8, solar energy production increased in the main European electricity markets compared to the previous week. The German market registered the largest increase, which was 23%, followed by increases of 16% in the French market and 12% in the Italian market. In the Iberian Peninsula, increases were 5.7% in Spain and 1.7% in Portugal. In the case of Spain, solar energy production includes solar photovoltaic energy and solar thermoelectric energy. In the Italian market, solar energy generation rose for the third consecutive week, while in Portugal and Spain, it was the second consecutive week of increases.
During the second week of July, the Iberian market broke historical records for solar photovoltaic energy production. Spain registered a record production of 208 GWh on Friday, July 12, while Portugal reached it on Saturday, July 13, with 23 GWh. On the other hand, the French and German markets registered the highest daily solar energy production for a July month. The French market reached 121 GWh on Monday, July 8, while in Germany it occurred one day later, on July 9, with a generation of 405 GWh.
According to AleaSoft Energy Forecasting’s solar energy production forecasts for the third week of July, it will continue to increase in the German market compared to the previous week. On the other hand, it will decrease in the Spanish and Italian markets.
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 second week of July, wind energy production decreased across the board in the main European electricity markets compared to the previous week. The French market registered the largest drop, 49%, followed by declines of 42% in the German market and 33% in the Italian market. The Spanish market was down 10%, while the Portuguese market had the smallest decline, 5.7%.
According to AleaSoft Energy Forecasting’s wind energy production forecasts, in the week of July 15, it will increase in the German and Italian markets. However, it will continue to decline in the Iberian Peninsula and France.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
Electricity demand
In the second week of July, electricity demand increased in most major European electricity markets compared to the previous week. The Italian market registered the largest increase, 12%, followed by the increases in the British and Spanish markets, 4.9% and 4.4%, respectively. The French market rose by 2.7% and the Portuguese market had the smallest increase, 1.2%. In the Iberian market of Spain and Portugal, demand continued its upward trend for the fourth consecutive week, while the British market maintained the same trend for the third week. On the other hand, the Belgian, German and Dutch markets registered declines ranging from 0.1% in the Dutch market to 0.6% in the Belgian market. In the case of the German and Belgian markets, they maintained their declines for the second consecutive week.
During the week, average temperatures increased across the board in the analyzed markets compared to the first week of July. The German and Italian markets registered the largest increases, 3.5 °C and 3.2 °C, respectively. In France, average temperatures increased by 2.3 °C. In the Iberian, British, Belgian and Dutch markets, the rises ranged from 1.0 °C in Portugal and Great Britain to 1.8 °C in the Netherlands.
In the week of July 15, AleaSoft Energy Forecasting’s demand forecasts anticipate an increase in electricity demand in the markets of Spain, Portugal and France compared to the previous week. On the other hand, demand will decrease in the markets of the Netherlands, Belgium, Italy, Germany and Great Britain.
Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE, TERNA, National Grid and ELIA.
European electricity markets
In the second week of July, prices in the main European electricity markets rose compared to the previous week. The IPEX market of Italy registered the smallest increase, 7.0%. In contrast, the EPEX SPOT market of France registered the largest percentage price rise, 95%. In the other markets analyzed at AleaSoft Energy Forecasting, prices rose between 23% in the MIBEL market of Portugal and 64% in the EPEX SPOT market of Belgium.
In the second week of July, weekly averages were below €70/MWh in most analyzed European electricity markets. The N2EX market of the United Kingdom and the Italian market were the exceptions, with averages of €84.16/MWh and €112.83/MWh, respectively. The Nord Pool market of the Nordic countries registered the lowest weekly average, €27.79/MWh. In the rest of the analyzed markets, prices ranged from €52.39/MWh in the French market to €68.97/MWh in the Portuguese market.
As for hourly prices, most analyzed European markets registered negative prices on Sunday, July 14. The exceptions were the British and Italian markets. The German, French and Nordic markets also reached negative prices on Saturday, July 13. In addition to July 13 and 14, the Belgian and Dutch markets registered negative hourly prices on July 10. The Belgian and French markets registered the lowest hourly price of the second week of July, ‑€74.02/MWh, on Sunday, July 14, from 14:00 to 15:00.
During the week of July 8, the fall in wind energy production and the increase in demand in most markets led to higher prices in the European electricity markets, despite the fall in the weekly average price of gas and CO2.
AleaSoft Energy Forecasting’s price forecasts indicate that, in the third week of July, prices will fall slightly in most analyzed electricity markets, influenced by the decrease in demand in most of these markets. In the case of Italy, the increase in wind energy production will also exert a downward influence on prices.
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 reached their weekly maximum settlement price, $85.75/bbl, on Monday, July 8. This price was lower than the last session of the previous week. On Tuesday, July 9, declines continued and these futures registered their weekly minimum settlement price, $84.66/bbl. According to data analyzed at AleaSoft Energy Forecasting, this price was the lowest since June 18. In the rest of the sessions of the second week of July, settlement prices were higher, but remained below $85.50/bbl. On Friday, July 12, the settlement price was $85.03/bbl, 1.7% lower than the previous Friday.
In the second week of July, concerns about demand in China exerted a downward influence on prices of these futures. However, the evolution of the Middle East conflict might exert an upward influence on prices in the third week of July, despite the strengthening of the dollar. This week, Brent oil futures prices will also be influenced by possible decisions to favor the Chinese economy.
As for settlement prices of TTF gas futures in the ICE market for the Front‑Month, in the first sessions of the second week of July, they continued the downward trend started at the end of the previous week. On Monday, July 8, these futures registered their weekly maximum settlement price, €32.29/MWh. As a result of the price declines, on Wednesday, July 10, the settlement price was €30.78/MWh. According to data analyzed at AleaSoft Energy Forecasting, this was the weekly minimum settlement price and the lowest since May 18. Although in the last sessions of the week prices increased, they remained below €32/MWh. On Friday, July 12, the settlement price was €31.72/MWh, 4.1% lower than the previous Friday.
In the second week of July, despite the outage at the Freeport liquefied natural gas export plant due to Hurricane Beryl, settlement prices of TTF gas futures were lower than in the previous week. Demand levels and high European reserves, in addition to a slight reduction in Asian demand, contributed to this behavior.
Regarding settlement prices of CO2 emission allowance futures in the EEX market for the reference contract of December 2024, during the second week of July, they remained below €70/t. In the first three sessions of the week, prices declined. On July 10, these futures registered their weekly minimum settlement price, €67.96/t. According to data analyzed at AleaSoft Energy Forecasting, this price was the lowest since the end of June. Subsequently, prices began to recover. On Friday, July 12, these futures reached their weekly maximum settlement price, €69.19/t, which was 1.7% lower than 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, PPA and energy transition
On Thursday, July 11, AleaSoft Energy Forecasting and AleaGreen held the 46th webinar of their monthly webinar series. On this occasion, the webinar analyzed the evolution and prospects of European energy markets, price cannibalization, low prices, price factor of renewable technologies, the prospects for photovoltaic energy, batteries and hybridization, as well as PPA from the point of view of large and electro‑intensive consumers. In addition, the new AleaSoft divisions to boost renewable energy and energy transition were explained. Guest speakers from AEGE, Banco Sabadell, Axpo Iberia and CESCE participated in the analysis table of the webinar in Spanish.
Source: AleaSoft Energy Forecasting.
