In the second week of March, prices in almost all European electricity markets fell compared to the previous week, influenced by the decrease in electricity demand and gas prices, as well as by the general increase in wind power production. As for wind power production, hourly records were reached on March 9 and 10 in Spain, France and Italy.
Solar photovoltaic and thermoelectric production and wind production
During the second week of March, solar production increased by 26% compared to the previous week in the Italian market. However, all other European markets analyzed in AleaSoft Energy Forecasting saw declines. The largest drop was in the German market, 38%. In the French and Spanish markets, the declines were 29% and 30%, respectively. On the other hand, the smallest drop in solar production, 25%, was recorded in the Portuguese market.
For the third week of March, AleaSoft Energy Forecasting 's solar production forecasts indicate that production could rise in Germany and Spain, but could fall in Italy.
During the week of March 6, wind production increased from the previous week in all European markets analyzed in AleaSoft Energy Forecasting. The largest increase, of 169%, was in the Portuguese market, followed by the Italian market, up 143%. In Germany, production with this technology increased by 73%, while in the Spanish and French markets the increases were 51% and 56%, respectively.
In addition, on Friday, March 10, from 10:00 to 11:00, a record wind power production of 16,598 MWh was achieved in the French market. On that day, from 17:00 to 18:00, a record production of 8 260 MWh was also recorded in Italy. In the case of the Spanish market, on Thursday, March 9, from 23:00 to 24:00, the hourly scheduled production on P48, of 20 139 MWh, was the second highest in history after that recorded on November 21, 2022.
For the week of March 13, AleaSoft Energy Forecasting 's wind production forecasts indicate that production could continue to increase in the German market, but declines could be recorded in the remaining markets.
In the week of March 6, electricity demand declined in most European markets analyzed in AleaSoft Energy Forecasting compared to the previous week. The exceptions were the UK and Dutch markets, with increases of 0.3% and 8.4%, respectively. On the other hand, the largest decline of 13% was recorded in the French market. In the other markets, demand fell between 0.2% in the German market and 8.3% in the Spanish market.
In the second week of March, rising average temperatures contributed to the decline in electricity demand in most European markets. The largest increase in average temperatures compared to the previous week, of 9.0 °C, was recorded in Spain, contributing to the largest decline in demand in this market. On the other hand, in the Netherlands and Great Britain, average temperatures fell, leading to increases in electricity demand.
For the week of March 13, according to demand forecasts by AleaSoft Energy Forecasting, demand could continue to fall in most European markets, influenced by rising average temperatures.
European electricity markets
In the week of March 6, prices in almost all European electricity markets analyzed in AleaSoft Energy Forecasting declined from the previous week. The exception was the Nord Pool market in the Nordic countries, up 41%. On the other hand, the largest price decline of 38% was in the MIBEL market in Spain and Portugal. In the remaining markets, price declines ranged from 7.0% in the UK's N2EX market to 16% in Italy's IPEX market .
In the second week of March, the highest average price of 143.24 E/MWh was in the UK market, followed by 134.30 E/MWh in the Italian market. On the other hand, the lowest weekly average was that of the Spanish market, at 84.95 E/MWh, followed by the average of the Portuguese market, at 85.06 E/MWh. In the rest of the markets analyzed, prices ranged from 108.84 E/MWh in the Nordic market to 131.07 E/MWh in the French EPEX SPOT market.
In terms of hourly prices, the Nordic market reached a price of 180.13 E/MWh on Monday, March 6, from 18:00 to 19:00, the highest since December 2022. On the other hand, in the MIBEL market of Spain and Portugal, on Saturday, March 11, from 15:00 to 16:00, a price of 1.49 E/MWh was recorded, the lowest since January. On the other hand, on Monday, March 13, from 13:00 to 15:00, negative hourly prices were reached in the Dutch and German markets, which were the lowest in these markets since the first day of the year. In the case of the Belgian market, on March 13, from 15:00 to 16:00, a price of 0.90 E/MWh was recorded, the lowest since January 2023.
During the week of March 6, the decrease in the average gas price compared to the previous week and the fall in electricity demand in most European markets led to lower prices in almost all the markets analyzed. The generalized increase in wind power production also had a downward influence on prices. In the case of the Italian market, the increase in solar production also contributed to this behavior.
AleaSoft Energy Forecasting 's price forecasts indicate that in the third week of March prices could continue to fall in most European electricity markets, influenced by decreases in demand in most of the markets analyzed, as well as by the increase in renewable production in some markets.
Brent, fuels and CO2
On Monday, March 6, Brent crude oil futures for Front Month on the ICE market recorded a weekly closing price high of $86.18/bbl, which was 4.5% higher than the previous Monday. Subsequently, prices declined to reach the weekly low closing price of $81.59/bbl on Thursday, March 9. This price was 3.7% lower than the previous Thursday. On Friday, the closing price rose slightly to $82.78/bbl, but was still 3.6% lower than the previous Friday.
In the second week of March, statements about possible interest rate increases by the US Federal Reserve supported price declines in Brent crude oil futures. However, the decline in US oil stocks and the release of US employment data allowed the downward trend to slow down at the end of the week.
As for TTF gas futures on the ICE market for the Front-month, on Monday, March 6, they recorded the lowest weekly closing price of 42.15 E/MWh. This price was 11% lower than the previous Monday and the lowest since August 23, 2021. On the following three days, closing prices were also lower than on the same days of the previous week, remaining below 44 E/MWh. However, on Friday, March 10, prices rose by 21% compared to the previous day and reached the maximum weekly closing price of E52.86/MWh. This closing price was 18% higher than the previous Friday and the highest since mid-February.
Milder temperatures and higher wind power production exerted a downward influence on prices in the second week of March. However, strikes in France, which affected liquefied natural gas importing plants, supported the recovery of TTF gas futures prices at the end of the second week of the month. In addition, news about the problem detected in a French nuclear reactor and its consequences on the country's nuclear production also contributed to the price recovery.
As for the closing prices of CO2 emission allowance futures on the EEX market for the December 2023 benchmark contract, during the second week of March, they reversed the trend of the previous week and recorded increases in all sessions. As a result, on Friday, March 10, the weekly high closing price of E99.79/t was reached, which was 8.3% higher than on the previous Friday.
AleaSoft Energy Forecasting's analysis of the outlook for European energy markets
This Thursday, March 16, at 12:00 CET, the third 2023 webinar in AleaSoft Energy Forecasting and AleaGreen's monthly webinar series will be held. This webinar, the third with guest speakers from EY, will discuss the outlook for European energy markets in spring 2023, the regulatory update of the Spanish energy sector and the outlook for the EU electricity market reform. Other topics that will also be addressed are the financing of renewable energy projects, the importance of PPAs and self-consumption, as well as the main considerations to be taken into account in the valuation of portfolios.
Moreover, AleaGreen 's long-term price forecasts are particularly useful both in the valuation of assets for the financing of renewable energy projects and in the negotiation of PPAs. These price forecasts are characterized by 30-year horizons, hourly disaggregation and confidence bands. The available electricity markets include the main European, American and Asian markets.
For more information, it is possible to go to the following link: https://aleasoft.com/es/produccion-eolica-bate-records-varios-mercados-europeos/