AleaSoft Energy Forecasting, November 20, 2023. During the weekdays of the third week of November, prices in the main European electricity markets registered an upward trend. However, over the weekend, the combination of lower demand and high renewable energy production helped to bring prices down. On the 19th, Spain registered the solar photovoltaic energy production record for a month of November and in Germany, on the 14th, wind energy production was the highest for a month of November.
Solar photovoltaic, solar thermoelectric and wind energy production
In the week of November 13, changes in solar energy production in the main European electricity markets compared to the previous week did not show a homogeneous trend. Solar energy production increased by 19% in Portugal, 18% in Italy and 16% in Spain. The opposite behavior occurred in the German and French markets, where solar energy production fell by 34% and 6.6%, respectively.
On November 19, the Spanish market produced 84 GWh using solar photovoltaic energy, the highest value since October 21 when it generated 89 GWh. On November 19, production was also the highest in history for a month of November.
For the week of November 20, according to AleaSoft Energy Forecasting’s solar energy production forecasts, it will increase in Germany and Spain, but it will decrease in Italy.
During the week of November 13, wind energy production decreased in most of the analyzed European markets compared to the previous week. The decrease ranged from 68% in the Portuguese market to 6.3% in the German market. At the same time, the Italian and French markets registered an increase in wind energy generation of 33% and 3.5% respectively.
Despite the inter‑week decline, on November 14 the German market produced 910 GWh using wind energy, the highest value since mid‑March. This value also represents the historical record of daily wind energy production in a month of November in this market.
For the week of November 20, AleaSoft Energy Forecasting’s wind energy production forecasts indicate that production using this technology will increase in the Iberian Peninsula, but it will decrease in the rest of the markets.Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE and TERNA.
In the week of November 13, the main European markets registered changes in electricity demand that did not show a uniform trend with respect to the previous week. In Germany and Italy, electricity demand increased by 1.0%, in Belgium by 1.6%, and in the Netherlands by 5.5%. In other markets, demand fell, ranging from 2.7% in France and Portugal to 1.2% in Great Britain.
In the third week of November, most of the analyzed markets registered an increase in average temperatures compared to the week of November 6. Increases ranged from 0.5 °C in the Netherlands to 1.9 °C in Spain. In Italy, average temperatures remained similar to those of the previous week. On the other hand, average temperatures decreased by 0.4 °C in Germany, the only market with decreases.
AleaSoft Energy Forecasting’s demand forecasts indicate that electricity demand will increase in most of the analyzed markets in the week of November 20. Only the German and Dutch markets will register lower demand.Source: Prepared by AleaSoft Energy Forecasting using data from ENTSO-E, RTE, REN, REE, TERNA, National Grid and ELIA.
European electricity markets
During the week of November 13, daily prices in the main European electricity markets progressively increased. On Friday, November 17, prices exceeded €115/MWh in all markets analyzed at AleaSoft Energy Forecasting. However, over the weekend, prices dropped again. As a result, the weekly average in some markets was lower than the previous week. In contrast, in the IPEX market of Italy, the Nord Pool market of the Nordic countries and the MIBEL market of Portugal and Spain, averages increased by 4.3%, 26%, 48% and 49%, respectively. In the remaining markets, prices declined between 2.5% in the EPEX SPOT market of Germany and 8.8% in the EPEX SPOT market of France.
In the third week of November, weekly averages were below €95/MWh in most of the analyzed European electricity markets. The exceptions were the N2EX market of the United Kingdom and the Italian market, where prices were €101.97/MWh and €126.73/MWh, respectively. In contrast, the French market registered the lowest average price, €83.48/MWh. In the rest of the analyzed markets, prices ranged from €84.35/MWh in the Portuguese market to €91.51/MWh in the Nordic market.
Precisely the Nordic market reached a price of €180.01/MWh on Thursday, November 16, from 17:00 to 18:00. This price was the highest since the first half of March in this market. On the other hand, the German, Belgian, French and Dutch markets registered hourly prices below €2/MWh on November 14 and 19. In the case of the German market, on Tuesday, November 14, there were three hours with negative prices.
During the week of November 13, the increase in the average price of gas and CO2 emission rights had an upward influence on European market prices. Over the weekend, the combination of lower demand and high renewable energy production helped prices to fall in most markets. In the case of the French market, wind energy production increased and demand fell for the week as a whole. This contributed to this market registering the lowest weekly average.
AleaSoft Energy Forecasting’s price forecasts indicate that in the fourth week of November prices in most European electricity markets might increase. Declining wind energy production and rising demand in most markets might contribute to this behavior. However, the increase in wind energy production in the Iberian Peninsula might lead to lower prices in the MIBEL market.Source: Prepared by AleaSoft Energy Forecasting using data from OMIE, EPEX SPOT, Nord Pool and GME.
Brent, fuels and CO2
On Monday, November 13, Brent oil futures for the Front‑Month in the ICE market registered their weekly maximum settlement price, $82.52/bbl. This price was 3.1% lower than the previous Monday. The following days of the third week of November prices declined to reach the weekly minimum settlement price, $77.42/bbl, on Thursday, November 16. This price was 3.2% lower than the previous Thursday and the lowest since the first half of July. On Friday, prices increased again. On that day, the settlement price was $80.61/bbl. This settlement price was 1.0% lower than the previous Friday.
In the third week of November, high supply levels, rising US stockpiles and negative data on US economic evolution exerted their downward influence on Brent oil futures prices. Concerns about demand in China also contributed to the price decline. However, expectations of further production cuts by OPEC boosted prices in the last session of the third week of November.
On Monday, November 13, TTF gas futures in the ICE market for the Front‑Month reached the weekly maximum settlement price, €47.87/MWh. This price was 6.8% higher than the previous Monday. However, according to data analyzed at AleaSoft Energy Forecasting, prices started to decline on Tuesday. As a result, on Friday, November 17, they registered the weekly minimum settlement price, €45.06/MWh. This price was 3.4% lower than the previous Friday. For the week as a whole, the average was 0.9% above that of the previous week.
During the third week of November, high European reserve levels and mild temperatures in Europe contributed to the decline in these futures prices. However, fears of possible supply disruptions due to instability in the Middle East and lower temperatures might exert an upward influence on prices in the coming days.
As for CO2 emission rights futures in the EEX market for the reference contract of December 2023, on Monday, November 13, they registered a settlement price of €77.48/t. This price was 1.6% lower than the last session of the previous week but 2.2% higher than the previous Monday. On Tuesday and Wednesday, prices increased. As a result, on Wednesday, November 15, the settlement price, €79.74/t, was the weekly maximum. This price was 5.3% higher than the same day of the previous week. In the last sessions of the week, prices fell again. On Friday, November 17, these futures registered their weekly minimum settlement price, €76.55/t. This price was 2.7% lower than the same day of the previous week. The weekly average was 1.7% higher than the previous week.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
Last Thursday, November 16, AleaSoft Energy Forecasting and AleaGreen held their November webinar. On this occasion, Luis Marquina de Soto, President of AEPIBAL, the Business Association of Batteries and Energy Storage, participated as a guest speaker. In the webinar, the speakers analyzed the prospects for the European energy markets for the winter 2023-2024 and the vision of the future of batteries and energy storage.
The AleaSoft Energy Forecasting and AleaGreen team is already organizing the next webinars of its monthly series. The December webinar will take place on the 14th and will address AleaSoft services for the energy sector. The January webinar, scheduled for the 18th, will feature speakers from PwC Spain for the fourth time.
Source: AleaSoft Energy Forecasting.