Platts: European Power Prices Dipped in August; Still Above June's Record Lows

Continental Natural Gas Prices Fell; U.K. Power and Natural Gas Prices Increased

Sep 12, 2013, 06:06 ET from Platts

LONDON, Sept. 12, 2013 /PRNewswire/ -- Day-ahead electricity prices in Continental Europe dipped last month, but continued to show modest signs of recovery from the historic lows recorded in June, according to monthly data just released by Platts, a leading global energy, petrochemicals and metals information provider.

The Platts Continental Power (CONTI) Index* slipped 1.4% in August to €39.55 per megawatt hour (/MWh). This compared to a July rate of €40.13 and was still up 18% from June's €33.50/MWh.

But by early September, near-term European electricity prices had resumed an upward price path. Despite the uptick, generator optimism remained tempered by the fact that prices, as measured by the Platts CONTI Index, remained nearly 20% below year-ago levels.

"Increased plant maintenance, a sharp drop in hydroelectricity production and low wind power output all contributed to a tighter supply scenario in August," said Andreas Franke, Platts power editor. "Market fundamentals indicate that Continental power prices may remain weak in the long term. Even if the renewables boom is slowing, there is little evidence of underlying demand recovery to reduce overcapacity."

Power prices in the U.K. for day-ahead needs averaged £47.3/MWh in August, down 3% from July but up 16% from August a year ago. The short-term dip was due to healthy nuclear generation availability. However, prices remain significantly higher versus year-ago levels due to the impact of high natural gas prices, and the U.K.'s reliance on gas-fired power generation.

"U.K. natural gas is expensive at 64 pence per therm in comparison to August 2012 when it was 54.56 pence per therm," said Franke. "This is in part due to freezing temperatures in March which depleted storage stocks and resulted in a highly active injection period over the summer. In addition, the Syrian conflict's knock-on impact on the oil market supported the natural gas price curve towards the end of the month."

At Continental Europe's most liquid natural gas trading hub, the Dutch TTF, the average price of day-ahead gas in August was €25.45/MWh, down from €26.05/MWh in July. On a year-over-year basis, August prices were up 6%, with the market reflecting higher oil prices and the indexing of gas to oil in long-term pricing contracts rather than the retreat in gas use for power generation.

Platts Continental Europe and U.K. Day-Ahead Monthly Averages








TTF (€/MWh)




U.K. Power (£/MWh)




U.K. Gas (pence/therm)




Source: Platts

NOTE: All figures are monthly averages of daily day-ahead contract prices as assessed by Platts.

*Platts Continental Power (CONTI) Index is a demand-weighted baseload average of day-ahead contracts assessed in Germany, Switzerland, France, Belgium and the Netherlands. The Platts U.K. assessments reflect day-ahead contracts assessed for firm delivery of power on the high voltage network of England, Wales and Scotland, and at the National Balancing Point for gas. The Platts assessments reflect prices as determined between buyer and seller in the open physical markets.

For more information on electric power or the methodology used by Platts in its power assessments, visit the Platts website

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