German 2018 contract at highest since March 2014
FRANKFURT, Sept 8 – Benchmark German power for delivery next year rose further on Friday afternoon on the European wholesale market after hitting its highest since March 2014 earlier in the session thanks to gains in related fuels and carbon markets.
* The German Cal’18 baseload contract hit 35 euros ($42.17) per megawatt hour (MWh), up 1.5 percent on the day and the highest since March 2014.
* “It’s a level that now feels right and is a wake-up call for people who are not covered,” one trader said.
* The equivalent French year-ahead contract, which is less liquid, rose 0.7 percent to 41.5 euros/MWh.
* December 2017 expiry EU carbon allowances were up 2.2 percent at 7.05 euros a tonne, boosted by growing resolve in the European Union to reform the market this year. The December allowances have now risen 60 percent from their 2017 low in May.
* Benchmark coal cif Europe for 2018 rose 0.4 percent to $80.5 a tonne, driven by Chinese demand in the global market. The contract breached $80 for the first time in three years on Tuesday and has gained a third in price since May.
* Gas and oil markets also firmed, interacting with power and carbon.
* Spot power was down on expectations of increased thermal and renewable supply in the near term, offsetting announcements of a French energy workers strike on Monday that could hit electricity output.
* Demand was due to be flat and there was uncertainty around wind patterns, traders said.
* German wind turbine production is seen in a range of 17 gigawatts (GW) to 27 gigawatts, according to various meteorological scenarios.
* German baseload power for Monday delivery was 1 percent lower than the price paid for Friday at 28.75/MWh.
* The equivalent French day-ahead contract slipped 7.4 percent to 31.25 euros/MWh.
* Power demand on Monday is expected to come in at 122 GW in Germany, Austria, France and Switzerland together, unchanged from Friday.
* Power station operators in Germany and Austria are set to raise available capacity by 4.9 percent in the seven-day period to Sept. 15, EEX bourse data showed.
* In eastern Europe, Czech Monday power, at 29.3 euros, was 60 cents below the price of Friday delivery. The year-ahead contract rose 65 cents to 35.5 euros/MWh. ($1 = 0.8300 euros)
Source: reuters
