S&P Global Platts: Solar Narrows Base-Peak Spread in May
Natural Gas Prices Stable Despite Reduced Storage Injections
LONDON, June 12, 2017 /PRNewswire/ -- UK day-ahead electricity and natural gas wholesale prices were stable in May as solar power chalked up fresh records, shrinking the spread between base and peak period power prices, S&P Global Platts data showed.
Meanwhile gas prices held up despite demand falling on an annual basis in May on the back of weaker injections into storage. This more than offset higher exports to Continental Europe.
The peak-baseload power price spread narrowed by over 40% year on year, with solar achieving a new half hourly record of 8.7 GW on May 26.
A sharp fall in wind output saw a £48/MWh price spike mid-May, but generally healthy supply margins ensured average day-ahead prices in May down 1% on April levels.
"Into June, and we've seen exceptional green power output as high winds and sunny spells combined with wood pellet burning to meet over 50% of midday demand on June 7," said S&P Global Platts' Power in Europe editor Henry Edwardes-Evans.
"Strong winds have produced longer periods of market volatility, with a string of negative imbalance prices on June 7 demonstrating a lack of flexibility in the system," said Edwardes-Evans.
On a year-on-year basis, May day-ahead power prices were 20% higher, tracking gains in the gas market.
Day-ahead gas prices averaged 39.240 pence/therm in May, marginally lower on April 2017 but up 29% YoY.
Stable spot prices came despite demand falling on an annual basis in May on the back of weaker injections into storage more than offsetting higher exports to Continental Europe.
Meanwhile spot gas prices look set to come under pressure during the second half of June, with the annual shutdown of the Interconnector likely to bring weak demand towards the end of the month.
With the long-range Rough gas storage reservoir unable to inject until May 2018 at best, and medium-range facilities waiting to take advantage of the upcoming Interconnector works, storage injections in May were down 67% on an annual basis, according to data from Platts Analytics.
| Platts UK Day-Ahead Power and Gas Assessments |
||||||||||
| Apr-17 |
Mar-17 |
MoM change |
Apr-16 |
YoY change |
||||||
| UK power (£/MWh) |
||||||||||
| Day-ahead average |
40.59 |
41.12 |
-1% |
33.85 |
+20 |
|||||
| UK gas (pence/therm) |
||||||||||
| Day-ahead average |
39.24 |
39.54 |
-1% |
29.12 |
+32 |
|||||
| Source: S&P Global Platts |
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For more information on electric power or the methodology used by Platts in its power assessments, visit the S&P Global Platts website www.platts.com.
About S&P Global Platts
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