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Energy Prices (Mid July 2016)

Mid July 2016

Electricity:  

UK power and gas prices for the coming winter leapt mid-July, as a 42-day outage at the UK’s only large-scale gas storage facility, Rough, was extended by at least seven months,

The developers of the planned 2,060 MW Trafford gas-fired power station have been given an extension by the UK government, after they failed to meet a deadline for securing investment for the project. The plant is the only new large gas-fired station to be included in the capacity mechanism. The new deadline is December 19th 2016.

Gas: 

News that a shutdown of the UK’s largest storage site, Rough, is to be extended until next spring blew Winter ’16 prices higher and sent prices across August and September reeling lower in mid-July, with varying knock-on effects on other periods.

As Winter ’16 prices initially rose on the back of the Rough news, Monthahead (August) and September prices conversely buckled by up to 4.5% ─ on the perception that gas demand will be dented during the two-month period, in the absence of buying interest for injection.

Summary position:

Oil $47.46barrel

Coal $59.50/MT

EUA 16 €4.91/TCO2

Gas 44.30p/th Oct 16

Gas 42.28p/th Apr 17

Electricity £44.30/MWh Oct 16

Electricity £42.28/MWh Apr 17