Emissions strongly rebounded over the last session of the week

The European power spot prices for today dropped significantly compared to Friday amid a sharp rise of temperatures and wind output offsetting the lower French nuclear availability expected in the upcoming hours. Prices reached 50.79€/MWh on average in Germany, France, Belgium and the Netherlands, -10.03€/MWh from Friday.

The French power consumption slightly strengthened to 78.52GW on average over the last working day of the week, +0.45GW from Thursday, but the temperatures rising back near seasonal normal today is expected to pressure the load below 72GW. The country’s nuclear generation eroded 0.36GW to 47.52GW and should drop to around 45GW today. The German wind production rose by 6.60GW on Friday to 12.50GW on average, and after slightly easing the following day soared to 15.58GW on Sunday and should reach around 25GW today.

The EUAs opened at 37.69€/t on Friday (-1.07€/t from Thursday’s settlement) and plunged to 37.06€/t over the first minutes of trading due to profits taking following a Bloomberg’s article from the day prior stating that the European Commission is considering limiting speculative trading in the EU ETS. Emissions prices however quickly reverted and rose sharply throughout the day as most market participants agreed that such intervention from the EC is actually unlikely to occur and that the market overreacted to the news. EUAs climbed by 0.70€/t in the aftermath of the morning’s auction which cleared with a massive 2.09 bid coverage (with compliance players likely attracted by the retreat of prices) and hit a fresh all-time high at 40.25€/t in the last hour of trading as a late surge of oil prices provided additional support to the carbon market. The EUA Dec.21 contract eventually closed at 40.02€/t with a hefty 1.82€/t weekly gain.

The power curve prices opened lower as well on Friday, mirroring Thursday’s late retreat of EUAs, but recovered throughout the day amid support from the rebounding emissions and rising gas prices.