29th November 2024 Energy Price Alert – UK Gas & UK Electricity
On Thursday Wholesale Gas and Electricity prices continued the downward momentum seen in the last few days. Though prices remain stubbornly high.
On the generation front, despite renewables accounting for over 40% of production in the past week, the average cost of generation was £88.14/MWh.
TPG’s view remains that there is scope for prices to drop back to below 20p/kWh for Electricity, but that this is unlikely to happen before the Spring. For Gas the outlook is less certain, because of the complex geo-political issues in terms of the incoming US President, and the continuing problems in the Middle East. That said, we do expect prices to drop, though it will be some time before they’re back below 4p/kWh.
Gas: Gas prices fell yesterday as the December contract shed its risk premium due to nearing delivery. The market is awaiting news on the first quarter weather outturn.
Power: Power prices fell yesterday as wind generation increased its forecast by 0.9GWs to 12.2GWs/day for the remainder of week.
Oil: Oil prices proved volatile yesterday due to a further escalation in the Middle East as Israel and Hezbollah accused each other of violating their recently agreed ceasefire. Prices lifted due to concerns around damaging oil infrastructure.
Carbon (EU ETS): The ICE Dec-24 fell to €67.63/t yesterday. The contract is trading flat this morning at €67.62/t.
Carbon (UKAs): The ICE Dec-24 rose to £36.59/t, yesterday. At the time of writing this morning, the contract is trading at £36.55/t.
