As expected, the European power spot prices weakened yesterday on lower clean fuel costs and forecasts of surging wind output and slightly improved nuclear availability with the Belgian nuclear reactor Tihange 2 (1GW) ramping up to its maximum capacity after hovering at 900MW for a few days. The day-ahead prices hence averaged 180.91€/MWh in Germany, France, Belgium and the Netherlands, -35.61€/MWh day-on-day.
Power prices faded as well on the curve, driven down by a sharp correction of gas prices amid significant LNG supply, forecasts of strong renewable production and weakening demand. The dropping emissions prices and Gazprom attempting to reassure its European counterparts about stable supply provided additional pressure on the power market, but the French Cal23 diverged from the other NWE prices to notch a 1.48€/MWh gain, increasing further its premium on its neighbors.
On the carbon market, prices plummeted in the morning after the daily auction clearing with a massive 71-cent discount to the secondary market triggered a sell-off. Last week’s mainly technical bullish rally had drove the EUA Dec.22 contract in overbought territory, therefore yesterday’s almost vertical retracement is likely to have been fueled by profit-taking and boosted by the falling equities, several market participants pointing out the worrying lack of buyers during the session. The benchmark contract consolidated in the afternoon to close the day at 87.02€/t, -4.52€/t from Friday’s settlement.
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