Platts: U.K., European Natural Gas Prices Continued to Slide in July

European, U.K. Power Prices Also Declined on Healthy Supplies

Aug 07, 2014, 05:47 ET from Platts

LONDON, Aug. 7, 2014 /PRNewswire/ -- Day-ahead natural gas and power prices in the U.K. and continental Europe continued to fall in July, extending the bearish price trend seen in both markets since the beginning of 2014, according to data just released by Platts, a leading global energy, petrochemicals and metals information provider.

U.K. day-ahead natural gas prices declined 5% month over month and were down 43% year over year. Day-ahead natural gas prices on the Dutch TTF – continental Europe's most liquid natural gas trading hub – also fell 5% month over month and 37% year over year.

Daily average European natural gas demand fell 4% in July from the preceding month, dropping to 425 million cubic meters per day (cu m/day) from 441 million cu m/day in June. This was similar to the 6% decline in demand seen from June to July of 2013.

"The decline in demand would have been even greater than 4% this July if not for an increase in natural gas use by power generators, who took advantage of lower gas prices and switched away from coal," said Alex Froley, Platts energy analyst.

A Platts survey sample of natural gas used in power stations in the U.K., Belgium, Italy, the Netherlands and France showed that consumption of the fuel grew 6% in July, partially offsetting a 10% reduction in household use and a 3% decline in commercial consumption.

In the electricity markets, the Platts Continental Power Index* (CONTI) fell 7.6% in June to €29.41 per megawatt hour (/MWh). This compared to the June level of €31.82/MWh and was down more than 21% year over year.

"The benchmark German day-ahead power price actually rose slightly in July as output from wind and solar declined, but strong nuclear and improving hydropower generation in France saw that market's day-ahead price plummet by 16% to €24.58/MWh," said Henry Edwardes-Evans, associate editorial director of Platts Power in Europe. "The Dutch equivalent was down some 7% to €34.63/MWh."

Prices in the U.K. power market continued their decline in June, down 5% month over month and down 27% year over year. This was a seventh consecutive month of decline in the day-ahead average, which hit a new four-year low of £34/MWh on July 17.

"Despite tightness in generation margins due to ongoing maintenance at nuclear, coal and natural gas power plants in the U.K., reduced summer demand coupled with increased output from wind, solar and biomass kept the market comfortably supplied," said Edwardes-Evans. "Bearish U.K. NBP** spot gas prices helped strengthen natural gas' position as the dominant energy source in the U.K., which accounted for more than 40% of the country's energy mix in July."

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 Index (CONTI) 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** (NBP) 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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