Editor’s Note: For comparison, residents of northern Ohio in the U.S. pay about $0.126/kWh.
German day-ahead electricity prices averaged $28.11 per megawatt hour (MWh) in May, their lowest monthly average in 12 years as wind, solar and hydro combined to crash the prompt market, according to data released by Platts, a global provider of energy, petrochemicals, metals and agriculture information.
At just under 10 terawatt hours (TWh), German wind and solar generation in May was up 22% year over year. Improved hydro levels in the Alps and the Nordic region added to oversupply across the region, with cross border power flows maximized between Germany/Austria, France and the Benelux nations by the switch to flow-based market coupling May 21.
European power prices, according to Platts’ Continental Power Index, plunged 24% in May to $30.41/MWh compared to April’s $40.03/MWh. The Index was down 16.35% compared to May 2014’s $36.35/MWh.
Platts’ regional analysis of European power and gas markets in May showed the following:
- Germany: Day-ahead power prices fell 16% month over month and 19% year over year as wind and solar output outstripped that of Germany’s nine remaining nuclear reactors. At the same time, the 900-MW GKM 9 coal-fired generator egan commercial operation. This is one of seven new coal units that, by year-end, will have added 6-GW to the German generation fleet.
- France: Day-ahead power prices fell 34% month over month and 13% from a year ago, as power consumption declined 2.7% year over year to 33.6 TWh. Nuclear output was down 4% on the year to 30.3 TWh, the lowest level for May in three years. Hydroelectric power, the second-largest source of French production, fell 3.6% to 5.7 TWh.
- U.K.: Day-ahead power prices averaged $64.19/MWh in May, down 6% from April but up 2% from May 2014. Increased production from wind farms and gas-fired power stations offset a drop in coal-fired output, with wind surging to more than 2 TWh, nearly double that of May 2014.
- U.K. day-ahead gas prices at the National Balancing Point fell 5% month over month in May to an average of 69.25 cent per therm (.01¢/th). On a year-over-year basis, prices were down 3%.
- Netherlands: On the Dutch TTF, continental Europe’s most liquid natural gas hub, day-ahead gas prices in May averaged $22.83/MWh. That was down 6% from April but up 8% from a year ago. Lower production quotas at the giant Groningen gas field provided price support last month versus May 2014, while a down turn in Dutch production from June 1 further tightened the market.
“Norwegian gas production outages drove the little there was by way of volatility in May, and maintenance overruns remained a source of price risk concern,” said Platts’ Team Leader of European Gas Reginald Ajuonuma.
Indeed, ongoing and new unplanned outages in Norway restricted European gas supply into early June, pushing U.K. day-ahead gas prices back over 43 p/th through to June 23.
No such tightness was seen in European power markets into early June, with strong solar output keeping a lid on prompt prices in Germany and surrounding markets. On June 23 German day-ahead power was assessed by Platts at $36.11/MWh.
|Platts Continental Europe and U.K. Day-Ahead Monthly Averages|
|U.K. Power ($/MWh)||64.19||68.59||62.63|
|U.K. Gas (.01¢/therm)||69.25||73.24||71.26|
NOTE: All figures are monthly averages of daily day-ahead contract prices as assessed by Platts.