SEE spot to rise by EUR 30/MWh on soaring gas prices – EQ
Date: January 25th 2022
Author: Tanja Srnovršnik
South-east European spot power prices could rise by about EUR 27-30/MWh this week due to recent gas price increases, Montel’s Energy Quantified (EQ) data shows.Hungarian baseload spot prices for Monday, Tuesday and Wednesday settled at EUR 246.20/MWh, EUR 299.13/MWh and EUR 295.12/MWh, while the Slovenian baseload for the first three days of this week traded at EUR 246.19/MWh, EUR 296.85/MWh and EUR 262.63/MWh, respectively. Spot prices for the first two days of this week traded about EUR 10-19/MWh lower in Bulgaria and Romania, while they equalled those in Hungary for Wednesday delivery.
The Hungarian contract for the current week closed at EUR 218.87/MWh on the EEX exchange, but analysts from EQ forecast higher average spot prices for this week, at EUR 237.57/MWh. Their outlook for last week was EUR 8.76 above the actual spot average.
Slovenian spot prices should be about EUR 2 higher than Hungary’s this week and about EUR 16/MWh higher than last week. Spot prices in Bulgaria and Romania should rise from last week’s average of EUR 200.83/MWh to EUR 227.37-231.32/MWh, said EQ.
“In general, market conditions have become bullish after the recent gas price rise,” said Eylert Ellefsen, senior analyst and hydrology expert at EQ, on Tuesday. This was the reason for EQ adjusting its spot price estimates upward.
Europe’s front-month TTF gas contract last traded at EUR 91.75/MWh in Ice Endex, down from EUR 93/MWh on Monday. Gas prices have been rising recently due to growing fears that a Russian invasion of Ukraine would jeopardize supply.
Rise in wind output
Looking at fundamentals, combined power demand in Romania and Serbia, two of the largest markets in south-east Europe, could average 12.5 GW/day this week, only slightly up from last week, while temperatures in Romania are expected to fall to -1.9C, or 0.2C below last week's average.
Meanwhile, the Romanian wind supply should fall to 1.39 GW/day this week from the 1.47 GW/day reported last week, EQ data showed. Combined hydropower output in Romania and Serbia should also fall, from 2.9 GW/day to 2.3 GW/day due to lower precipitation.
Ellefsen added that the German wind power output is expected to increase strongly as the weekend approaches. EQ estimates the whole week's average output at 24.8 GW/day, up from 21.8 GW/day a week ago.
Slovenian and Hungarian spot prices are not expected to see much change next week, while Romanian and Bulgarian prices should see a EUR 2.4-6/MWh decrease on the back of “rather strong Romanian wind power output,” Ellefsen added.
Hungarian power contracts for the fifth week of this year last traded at EUR 215.83/MWh on the EEX exchange.
This article is available also in Slovene.