Overall retreat of the energy complex

The European power spot prices for today reached a level close to Friday’s as the retracing gas prices, weaker demand and higher wind output expected in the upcoming hours were offset by forecasts of lower nuclear availability and solar production. The day-ahead prices hence averaged 269.29€/MWh in Germany, France, Belgium and the Netherlands, -2.82€/MWh from Friday but still +93.23€/MWh week-on-week due to the massive increase of fuel prices last week.

On the curve, the power contracts gave back part of their recent gains ahead of the weekend alongside the gas market as the impact of the news of Nord Stream 1 reduced flow faded.

Mostly steady throughout the last session of the week despite a particularly strong morning auction result, the EUAs fell at the end of the day tracking a late drop of gas and equity prices to end the week nearly flat from the previous one. The market’s reaction was indeed rather muted to the daily primary sale clearing with a massive 47-cent premium over the secondary market spot price and above-average 2.51 cover ratio as the EUAs instead chose to follow the overall retracement of the energy complex from the impressive surge initiated earlier this week by the news of Nord Stream 1 flow’s disruption. The EUA Dec.22 closed the day at 82.37€/t, -0.63€/t from Thursday and +0.51-cent (+0.62%) week-on-week. The benchmark contract is however rebounding this morning, seemingly buoyed by reports that Germany plans to use its lignite and coal power plants from the reserve to limit the use of gas in the power industry.

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