Nordic power prices rose in response to firmer gas and CO2 prices on Friday with slightly colder and drier weather forecasts adding support.
The front-month contract was last seen at EUR 54.50/MWh, up EUR 2.50 from Thursday’s close on Nasdaq Commodities, while the front quarter was EUR 2.25 higher on the day at EUR 63.00/MWh.
Both contracts had slumped to their lowest levels since 9 October in the previous session.
“I think the main reason for today’s movement is the turnaround we saw in gas and CO2 prices yesterday afternoon, and both these markets have continued up today,” said Ulrik Ljungars, trader at Sweden’s Modity.
Europe’s benchmark gas price, the Dutch TTF front month, was last trading up EUR 1.40 at EUR 50.00/MWh on the Ice exchange, while the benchmark Dec 23 carbon contract stood EUR 0.43 higher on the day at EUR 79.04/t.
On the weather front, forecasts for the Nordic market had turned slightly colder and drier overnight, providing some support to prices, said Ljungars.
The 10-day weather forecasts predicted rain and snow equivalent to 7.3-12.2 TWh of potential hydropower output, well above the seasonal average of 7.3 TWh, according to Montel’s Energy Quantified (EQ).
Temperatures would drop below normal from around 10 November after turning above normal over the weekend and into next week, EQ data showed. This would see the hydrological balance – a measure of reserves in reservoirs, snow and soil – drop from 6.1 TWh above normal currently to 4.7 TWh in two weeks.
Weak spot
In the spot market, the system price for Saturday could drop well below the EUR 31.65/MWh settlement for Friday delivery, due to higher wind output, mild weather and heavy rain.
The Saturday futures contract on Thursday settled at EUR 11/MWh on the Nasdaq exchange. Montel’s AI-based forecasts predicted a Saturday delivery price of EUR 16.81/MWh.
Average wind power output is set to rise from 16 GW currently to around 19 GW on Saturday, while consumption is forecast to drop from 48 GW to 44 GW, according to EQ.
Source : Montel News