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Energy Prices (Mid December 2014)

Mid December 2014

Electricity:  The sharp falls in price over the last few weeks leave the market vulnerable to a price bounce if cold weather, infrastructure issues or any international unrest upset the current sense of security

Unit 4 at Ferrybridge coal fired power station looks set to restart early in the new year, returning 400 MW of capacity to the network.

Approval has been granted for the construction of a 1,200 MW offshore wind farm at Hornsea, with a further 2,800 MW ultimately planned for the area.

Gas: The Dutch government is considering scaling back in production at the Groningen gas field (the largest in Europe) following incidences of earthquakes in the area.

The UK’s largest storage site, Rough, is to shut down for maintenance for  several days in late December, reducing the market’s ability to respond to any other squeezes on supply.

Prices for LNG in Asia continue to shrink, and with high storage levels in Japan and Korea, exports are being diverted towards Europe, giving the UK high storage levels for the winter.

Summary position: 

Oil $61.85/barrel

Coal $68.955/MT

EUA 14 €6.86/TCO2

Gas 53.3p/th Apr 15

Gas 53.83p/th Oct 15

Electricity £49.1/MWh Apr 15

Electricity £49.4/MWh Oct 15