The power spot prices presented mixed variations for today, down in Germany and the Netherlands amid forecasts of sharply rising wind output for the upcoming hours, but slightly up in France and Belgium as this bearish pressure was offset by expectations of weaker French nuclear availability. The day-ahead prices hence fell by 8.55€/MWh on average in Germany and the Netherlands to 164.04€/MWh but hedged up by 1.81€/MWh in France and Belgium to 169.25€/MWh on average.
Meanwhile, the power curve prices observed one of their most volatile session on Wednesday after a fire on the UK – French 2GW IFA interconnector resulted in both bipoles going offline with National Grid expecting one 1GW bipole to be restored to service only on Sept. 25th and the other not until March 2022. The power contracts jumped on the news, the German Cal2022 rising as high as 108€/MWh, as the issue was expected to lead to a higher gas demand in the UK this winter, strengthening the concerns of a supply crunch and hence lifting the gas market to new records. The power prices however eased later in the day as the gas market gave back most of its gains, but still managed to post quite hefty day-on-day gains, although already erased this morning by the sharper retracement of the underlying gas prices.
The strong volatility of the gas and power markets was also reflected in the carbon prices yesterday, albeit their weakening correlation with the spiking gas prices was once again highlighted by their diverging variations in the afternoon. Some market participants also attributed the volatility to the nearing expiration of the EUA September options. The EUA Dec.21 dropped as low as 58.74€/t midday but the dip buyers stepped in and quickly pushed it back up to the intraday high of 61.44€/t. After a late retreat, the benchmark contract eventually settled at 59.86€/t, only 1-cent up from the previous day.
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