In the week of May 8, solar energy production increased compared to the previous week in the Iberian Peninsula, 10% in Portugal and 5.6% in Spain. In Portugal, during the weekend, the four hours with the highest values in the history of this market of solar photovoltaic energy production were registered, exceeding 1,634 MWh in each of them. The record value of the highest production was registered on Saturday, May 13 between 13:00 and 14:00 with 1,645 MWh generated with this technology. In Mainland Spain, the third and fourth highest solar photovoltaic energy production values in history were registered between 13:00 and 15:00, which were above 15,100 MWh.
However, in the rest of the markets analysed at AleaSoft Energy Forecasting, decreases in solar energy production were registered, of 29% in Italy, 21% in France and 13% in Germany. For the week of May 15, AleaSoft Energy Forecasting’s solar energy production forecasting indicates that it may continue to increase in Germany, while in Spain and Italy it may decrease.
In the second week of May, an important increase was registered in wind energy production in Portugal, when it raised 89% compared to the production of the first week of the month. In the Spanish and French markets, the production with this technology also increased, 39% in Spain and 7.2% in France. However, wind energy production in Germany set 10% below that of the previous week, and 4.2% in Italy. For the third week of May, AleaSoft Energy Forecasting’s wind energy production forecasting indicates that wind energy production might decrease in most of the analysed markets except in Italy.
During the second week of May, electricity demand increased compared to the previous week in almost all analysed markets. This behaviour was mainly due to the recovery of the demand after day 1 being a festivity in most markets. The increases were between 0.9% in Italy and 11% in the Netherlands. However, in Great Britain, where on Monday, May 8, the festivities associated with the coronation of King Charles III continued, the demand decreased by 0.2%.
Regarding average temperatures, decreases were registered compared to the previous week in the southernmost European markets, Spain, Portugal, France and Italy, as well as in Great Britain, while temperatures increased in the rest of the markets. For the week of May 8, according to the demand forecasting made by AleaSoft Energy Forecasting, the demand is expected to increase in the European markets except in Spain, where May 15 is a holiday in Madrid, and in Germany, Belgium and Netherlands, where on May 18 the Ascension Day is celebrated.
European electricity markets
In the week of May 8, prices in most of the European electricity markets analysed at AleaSoft Energy Forecasting remained stable, although with a slight upward trend compared to the previous week. The highest price increase, of 5.4%, was registered in the IPEX market of Italy. On the other hand, prices decreased in the Nordic and Iberian markets. The largest prices fall, of 39%, was that of the Nord Pool market of the Nordic countries. In the case of the MIBEL market of Spain and Portugal, the decreases were 14% and 17%, respectively.
In the second week of May, the highest average price, of €119.36 ($129.98)/MWh, was that of the Italian market, followed by the average of the N2EX market of the United Kingdom, of €101.47/MWh. On the other hand, the lowest weekly average price was that of the Nordic market, of €47.74/MWh. In the rest of the analysed markets, prices ranged from the €73.76/MWh of the Spanish market and the €95.13/MWh of the EPEX SPOT market of Germany.
Regarding hourly prices, in the MIBEL market of Spain, on Sunday, May 14, nine zero-price hours were registered, between 9:00 and 18:00. In the MIBEL market of Portugal, on that same Sunday, there were three zero-price hours, from 15:00 to 18:00. On the other hand, in the Dutch market, on Saturday, May 13, between 11:00 and 16:00, a zero-price hour and four negative price hours were registered. The lowest hourly price, of -€99.93/MWh, was reached from 13:00 to 14:00 and was the lowest one since April 19.
During the week of May 8, the decrease in the average gas price was compensated by the increase in demand in most of the markets. In the case of the Italian market, wind and solar energy production decreased, with the highest weekly average value being registered. However, the increase in solar energy production and the relevant rise in wind energy production in the Iberian Peninsula contributed to the price decreases registered in the MIBEL market. The AleaSoft Energy Forecasting’s price forecasting indicates that, in the third week of May, prices may decrease in most European electricity markets.
Brent, fuels and CO2
Settlement prices of Brent oil futures for the Front-Month in the ICE market registered a settlement price of $77.01/bbl on Monday, May 8. This price was 2.9% lower than that of the previous month, but 2.3% higher than that of the last session of the first week of May. On Tuesday, May 9, prices continued rising and the maximum weekly settlement price, of $77.44/bbl, was reached, which was 2.8% higher than that of the previous week. Afterwards, prices decreased till registering the minimum weekly settlement price, of $74.17/bbl, on Friday, May 12. This price was 1.5% lower than that of the previous Friday.
The news about the plans of the United States to replenish its strategic reserves of crude oil contributed to the weekly maximum average price being reached on Tuesday, May 9. However, in the second week of May, Brent oil future prices continued influenced downwards by fears of an economic recession and concerns about instability in the US banking sector.
As for TTF gas futures in the ICE market for the Front-Month, on Monday, May 8, they reached the weekly maximum settlement price, of €36.87/MWh, although this price was 5.0% lower than that of the previous Monday. Afterwards, price decreases were registered. As a consequence, on Friday, May 12, the weekly minimum settlement price, of €32.77/MWh, was reached. This price was 10% lower than that of the previous Friday and the lowest since the first half of July 2021.
The abundance of liquefied natural gas supplies and high levels of European stocks continued to exert a downward influence on prices during the second week of May.
Regarding CO2 emission rights futures in the EEX market for the reference contract of December 2023, at the beginning of the second week of May, prices continued the upward trend that started in the previous week. On Wednesday, May 10, the maximum weekly settlement price, of €89.49/t was reached, which was 5.3% higher than that of the previous Wednesday. However, on Thursday prices decreased and in the last two sessions of the week, settlement prices remained below €88.50/t. Despite it, the settlement price of Friday, May 12, was €88.48/t, 4.1% higher than that of the previous Friday.
AleaSoft Energy Forecasting’s analysis on the prospects for energy markets in Europe and the financing and valuation of renewable energy projects On Thursday, May 11, the last webinar of AleaSoft Energy Forecasting and AleaGreen was held. The topics covered in this webinar were the evolution of the European energy markets and the vision of the future of the energy sector. Luis Atienza Serna, who was General Secretary of Energy, Minister of the Government of Spain and president of Red Eléctrica de España for several years, participated in the analysis table of the webinar in Spanish.
The next webinar of the series of monthly webinars of AleaSoft Energy Forecasting and AleaGreen will take place on June 8 and it will have the participation of speakers from Engie. In this case, in addition to the evolution of the energy markets, the financing of renewable energy projects and PPA will be analysed. The main regulatory issues of the electricity sector will also be discussed.
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