European Power Prices Slide as Milder Weather Set to Ease Demand
(Bloomberg) -- Power prices fell across Europe as forecasts for milder weather signaled lower demand.
Contracts for February delivery in France, Germany and the Nordic region dropped as meteorologists updated their longer-term outlooks to show higher temperatures. German year-ahead electricity also declined.
EUROPE WEATHER: Maxar Raises Temperature Forecast for Next Week
Prices are still more than five times higher than usual for this time of year, as natural gas prices continue to soar and traders price in the possibility of a cold snap in the months to come. While electricity contracts in France have fallen from record levels, they’re particularly vulnerable to freezing weather.
German power for February slid 2% to 265.50 euros a megawatt-hour on EEX, while the French equivalent dropped 4.9% to 411 euros. The Nordic contract fell 1.7% to 98.15 euros on Nasdaq Commodities ASA. German year-ahead power, a European benchmark, declined 1.3% to 138 euros.
Day-ahead prices rose across the board as wind output is set to drop sharply tomorrow. That will mean more high-priced gas is needed for power generation.
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