Prices of European power and natural gas declined in May, according to monthly statistics just released by Platts, a leading global energy, petrochemicals and metals information provider.
European power prices fell 12% month on month in May and were down nearly 26% year-on-year, Platts reported. The average cost of power in continental Europe, as indicated by the Platts’ Continental (CONTI) Power Index, a demand-weighted baseload average of day-ahead contracts assessed in Germany, Switzerland, France, Belgium and the Netherlands, was 43.28 euros (Eur) per megawatt hour (/MWh) in May compared to Eur49.37/MWh in April and Eur58.51/MWh in May 2011.
Meanwhile natural gas prices at continental Europe’s most liquid trading hub, the Dutch Title Transfer Facility (TTF), dipped 2.7% in May from April, according to Platts’ assessments, though they rose by 5.2% on a year-on-year basis.
The average cost of day-ahead natural gas on the Dutch TTF edged down to Eur24.15/MWh in May from Eur24.81/MWh in April, the Platts price assessments show. The year-ago May 2011 average price was Eur22.96/MWh.
“European power and gas price movements in May were pressured by differing factors,” Platts editor Henry Edwardes-Evans said. “Last year European power was buoyed by Germany’s decision to close nuclear reactors, but oversupply and weak demand have since re-asserted themselves. Natural gas has been shielded to some extent from demand weakness by its link to global oil, although we’ve witnessed some significant price declines in recent weeks, again due to slack demand and comfortable supply margins.”
Platts Day-Ahead Monthly Average Price Assessments
Continental Europe and UK
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* All figures are monthly averages of day-ahead contract prices as determined between buyer and seller in the open market and assessed by Platts.
The Platts UK power price assessment reflects trade in day-ahead baseload electricity under the Grid Trade Master Agreement, expressed as British pounds per megawatt hour (GBP/MWh). The Platts UK gas price assessment reflects the value for physical delivery at the UK’s National Balancing Point expressed as British pence per thermal unit.
In addition to the Platts Conti Indexes, Platts publishes the Platts Pan-European Power (PEP) Index, also a demand-weighted day-ahead baseload index indicating price trends for Europe’s free electricity markets as a whole. Europe is moving towards a continental market model, and while transmission constraints mean the reality may be some way off, these indices address the industry’s need for representative, Europe-wide indices.
For more information on electric power or the methodology used by Platts in its power assessments, visit the Platts website www.platts.com.