European power curves inch lower, spot prices remain strong

Spot power prices were mixed in NW Europe on Thursday with strong gains in France and significant losses in Germany. German wind power generation was unseasonably weak in June and in the first half of July (see graph of the day) while French nuclear generation remained relatively low as well, which provided support to spot power prices across Europe. Overall, day-ahead prices for today reached 84.23€/MWh on average in Germany, France, Belgium and the Netherlands, +2.35€/MWh day-on-day. On the curve, most contracts inched lower, tracking losses in natural gas and emission prices. Coal prices remained strong with API 2 Cal 2022 prices reaching a new 2021 high at $91.41/t at the close yesterday.

European power curves could rebound on Friday, as gas markets could price a slightly higher risk premium over Nordstream 2 after the Biden-Merkel meeting ended with no agreement on the pipeline and EUA prices are still looking for a direction after the release of the Fit to 55 package. A lower auction volume planned for August and delayed free allocations In Germany and Poland could be supportive.