9th February 2024 Energy Price Alert – UK Gas & UK Electricity

Wholesale gas and electricity prices were generally static on Thursday, although very small price drops were seen.

At retail level pricing remains subdued and we expect this to continue through the Spring and Summer at least, as further gas production comes online.

In terms of our weekly review of UK electricity generation, the price last week dropped further to £51.64/mWh due to renewables contributing 48.8%, of which wind was 45.2%. Nuclear remained at 11.4%, and biomass remained at 7%. Gas contributed just 21.3% of UK generation in the past week. The lower usage of gas has also contributed to the reduction in wholesale prices, due to reduced demand.

Gas: Gas prices fell yesterday following the return of supplies from the Norwegian Continental shelf (NCS) and a mild weather outlook. Temperatures are expected to outturn above average over the next few weeks, although Wind generation has been forecast to decline, potentially leading to demand for Gas-fired generation, limiting losses. 
Power: Power prices fell yesterday, tracking the wider energy complex, namely Carbon and Gas. The Hartlepool reactor returned to generation from unplanned maintenance. 
Oil: Oil prices rallied yesterday following news of Israel rejecting Hamas’ negotiations for a ceasefire. Re-igniting concerns surrounding supply disruptions. US interest rates are likely to be cut further into the year due to a strong performing $USD, as jobs grew, providing bearish resistance against the gains of oil prices. 
Carbon (EU ETS): The ICE Dec-24 contract closed at €60.78/t yesterday. The contract is currently trading down at €59.77/t. 
Carbon (UKAs): The ICE Dec-24 continued to fall yesterday, closing at £34.63/t. Continuing the decline this morning, the contract is currently £35.15/t. 

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The Procurement Group

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