Establish The Current Level Of Wholesale And Retail Energy Prices And The Fundamental Drivers Behind Movements In The Traded Value Of European Gas And Power
Research and Markets (http://www.researchandmarkets.com/reports/c75507) has announced the addition of “Monthly Price Brief – A Review of European Gas and Power Price Trends: September 2007″ to their offering.
Introduction
The growing role of wholesale traded energy markets across Europe creates a greater need for players throughout the value chain to be aware of the latest market movements and developments. From the wellhead or power station gate to the end-user, volatility in the spot and forward price of power and gas is creating an increasingly challenging environment for all market participants.
Scope
– An examination of the wholesale gas price trends in Europes three key markets – the UK NBP, the Zeebrugge Hub and the Dutch TTF.
– An assessment of traded power prices in the UK, Belgian, Dutch, German and French wholesale power markets.
– Insight and analysis into the impact of wholesale markets on the wholesale / retail price interface.
Highlights
Winter 2007/08 outlook is positive and holds no surprises European Emissions Trading Scheme (ETS) 2007/08 is gathering momentum Northwest European power prices are showing mixed messages
Reasons to Purchase
– Establish the current level of wholesale and retail energy prices and the fundamental drivers behind movements in the traded value of gas and power – Understand how wholesale pricing impacts different facets of the value chain, identifying the potential to limit risk through hedging strategies
– Forecast future developments in the traded price of gas and power in order to successfully take advantage of arbitrage opportunities
CATALYST
SUMMARY
ANALYSIS
Winter 2007/08 outlook is positive and holds no surprises
The unusually mild weather has played its part in reducing the need for heaters
UK gas supplies are buoyant as new infrastructure comes online and flows increase
LNG: Norway and IUK are the UKs key import facilities and have been increasingly on call since the UK became a net importer of gas in 2005
The availability of generation capacity also looks strong as the power sector shrugs off 2006/07 uncertainties
Rough storage will reach 100% capacity ahead of time, by Q3 2007
Gas prices are expected to reflect the stable conditions this winter in contrast to previous years
The power curve is also stable and no shocks are in store for traders or customers alike
Facilitating the changes has been a challenge during 2007 on the medium- and short-range storage positions
Emissions trading gathers momentum in the EU
The Kyoto Protocol envisaged global carbon emissions trading
EU member states are the key Kyoto Protocol signatories
The UK has escaped an EC clampdown on Phase II allocations
Trading volumes increase significantly as the Phase I – Phase II spread illustrates efficiency
Wholesale and retail interface: price setting is complex and fortunes vary among suppliers
Tailored risk management strategies (1) – the cap provides cover for those buyers with an aversion to market exposure
Risk management strategies (2) – the collar is a more flexible product aimed at suppliers with a riskier approach
Complexities in buying on the forward curve are illustrated by comparing the short and far end of the forward curve
A breakdown of the average household bill shows that wholesale costs make up the most significant portion
Prices reach 2005 levels as security of supply and gas infrastructure ease fears of a shortage
Wholesale and retail price differential indicates that margins are available at first glance
Northwest European power prices showed mixed signals
Belgian power prices are diverging on the short and near curves
French near-end contracts switched direction as monthly prices outstripped winter 2007/08 expectations
In contrast to regional sentiment, the German power market showed a slow downward turn on all contracts
Bearish sentiment dominated the Dutch power market as contracts fell across the board
UK baseload power prices showed resilience, highlighting the most stable period of trading for almost a year
The NBP led the way as northwest European gas prices turned downwards amid high confidence
UK gas prices turned downwards as fundamental demand and supply conditions aided low UK gas prices
Dutch gas prices followed the NBP trend as short and long ends of the curve resulted in falling prices
Belgium gas contracts followed the pan-European trend of falling prices
APPENDIX
This brief builds upon extensive pricing proposition
Glossary
This brief contains a number of industry standard terms
Our analysis builds on other sources to provide greater insight
Further Reading
Extended Methodology
We assess the profitability of fossil fuel plants across northwest Europe
Our bespoke services can be tailored to your specific needs
Ask the analyst
Disclaimer
Companies mentioned:
– Arcadis N.V
– Future Plc
– National Grid Plc
For more information visit http://www.researchandmarkets.com/reports/c75507
Source: Datamonitor