Wholesale gas and electricity prices continued their unabated rises on Thursday of this week.
On the generation side, in the past week, electricity was reasonably stable at £116 per megawatt-hour, which is almost double what it was before this conflict started. The generation price is driven by gas, albeit it accounts for only 17% of production. The reason is that the UK electricity price is governed by that of the highest individual component, and the highest-priced component at the moment is gas.
Renewables were well over 50% last week, with wind at 46% and solar at 10%. In addition, nuclear was at 13%, which is encouraging, and biomass was at 10%. All in all, this is a good position once gas can begin flowing again from Qatar.
| Gas: Gas prices continued to rise yesterday. Prompt prices were supported by declining opportunities for European storage to reach its target level. All contracts were driven bullish by the increasing conflict in the Middle East. Iran-backed Houthis have captured the Mokha port on the Red Sea. Prices have opened softer this morning as the market looks to correct the dramatic gains from yesterday. Power: Power prices tracked the underlying gas market yesterday. Wind generation has been reforecast to above average for the upcoming weeks, limiting demand for gas in the prompt. Curve prices rose tracking the rising hostilities in the Middle East and the declining chances of EU gas storage being ready for the winter. Oil: Oil prices surged 6% yesterday as the largest attacks on shipping since the war began between the US and Iran worried traders about further disruptions and already tight supplies. Prices have softened slightly on today’s open as the market looks to correct itself. Carbon (EUAs): The ICE Dec-26 closed at €85.82/t last night. The contract opened this morning at €85.82/t. Carbon (UKAs): The ICE Dec-26 traded to £62.54/t yesterday. Opening at the £62.31/t this morning. |
#gas #electricity #businessutilities #businessgas #businesselectricity