Spot prices drop on increased wind supply

On Monday, the German Tuesday spot rate fell as it was expected that a rise in wind power would offset an increase in electricity demand.

LSEG data shows that the German baseload electricity for Tuesday at 0924 GMT was 143.80 Euro per megawatt-hour, down 0.8% compared to Friday's closing price for Monday delivery.

LSEG data revealed that the equivalent French contract was 90 euros/MWh. The Monday contract was not traded on Friday.

LSEG data indicated that the German wind output is expected to increase by 5 gigawatts on Tuesday to 9.5 GW. The French output, however, was forecast to be 350 megawatts at 6.4 GW.

Riccardo Paraviero, LSEG analyst, says that Tuesday's outlook is on the negative side. The German residual load has dropped due to increased wind power supply, which offsets an expectation of higher demand.

The data indicated that solar power production in Germany is expected to drop by 250 MW, to 6.2 GW.

LSEG data shows that wind power will fall to approximately 6 GW Wednesday, before rebounding at around 16 GW and then around 15 GW Thursday and Friday.

Analysts at Engie’s EnergyScan said that tight conditions will likely continue for the remainder of the week. France is expected to gradually tighten as it initially gains from the relatively higher wind generation during the first few days.

The French nuclear capacity has decreased by three percentage points, to 64%.

LSEG data shows that power consumption in Germany will rise by 2 GW Tuesday to 57.8 GW while France's demand is expected to increase by 1.7 GW up to 47.1 GW.

LSEG data revealed that the German baseload power for the year ahead fell 0.5%, to 87.10 Euros/MWh. The French equivalent fell 1.2% to 57.85 Euros/MWh.

The benchmark contract on the European carbon markets fell 1.1%, to 78.83 euro per metric ton. (Reporting and editing by Clarence Fernandez; Forrest Crellin)

(source: Reuters)