Europe to Benefit from Lower Coal Prices and More Renewable Generation

offshore wind energy in Germany BARD project completed
offshore wind energy in Germany BARD project completed

More Renewable Generation – ( Solar Thermal Magazine)

With the price of oil falling it seems like everyday and consumers utilizing more energy efficient and renewable energy technologies the cost of energy in many areas is on the decline. This is true today for Europe.

European day-ahead electricity prices fell heavily in March as good wind conditions combined with lower natural gas prices and enduringly weak coal prices, according to data just released by Platts, a leading global energy, petrochemicals, metals and agriculture information provider.

The Platts Continental Power (CONTI) Index* fell 11.5% to €38.43 per megawatt hour (/MWh) compared to February’s €43.42/MWh. The Index was down 8.8% compared to March 2014’s €35.06/MWh.

Platts’ regional analysis of European power and gas markets in March showed the following:

  • Germany: Day-ahead power prices in March averaged €30.96/MWh, driven down 14% from February by a surge in wind output in the second half of the month. Combined wind and solar generation in March reached a record at 10.2 terawatt hours (TWh), with wind up 59% on a year-over-year basis at 7.3 TWh, but solar output down 13% from March a year ago at 2.9 TWh.
  • France: Day-ahead power prices averaged €42.98/MWh in March, down 12% from February but up 25% year-over-year. Wind levels were due to increase into April, but the start of several planned power station outages, including gas plant closures for the summer, were poised to tighten the generation market as April progressed.
  • U.K.: Day-ahead power prices averaged £40.28/MWh in March, down 5% from February and down 8% year-over-year. Supply remained comfortable with strong levels of wind output and imports. Meanwhile, spot prices on the U.K.’s National Balancing Point (NBP) hub for gas recovered some ground lost earlier in the month as U.K. gas exports increased and storage injections began. U.K. gas demand averaged 259 million cubic meters per day (cu m/d) in the final two weeks of March, 12 million cu m/d higher than for the same period in 2014.
  • Netherlands: On the Dutch TTF, continental Europe’s most liquid natural gas hub, day-ahead gas prices in March were down 3% month-over-month and down 4% year-over-year. An increase in Russian gas flows, warmer-than-normal temperatures, a benign weather outlook and lower export demand removed any potential sting in the tail of winter for the European gas market. As in the U.K., however, there was a modest bounce late in the month on worries about a reduction in storage capacity at the U.K.’s Rough storage facility and a crude oil price rally after war broke out in Yemen.

Germany’s lower monthly average power price masks strong volatility in the short term, with hourly prices ranging from sub-zero levels to spikes of almost €100/MWh as wind and solar output ratchets up and down in a 1-GW to 44-GW range,” said Platts’ European Power Managing Editor Andreas Franke.

Overall, however, German power prices remain depressed amid record low European coal prices, only partially offset by the weaker euro.

In the U.K. gas market, transmission system operator Centrica said late March that capacity at its Rough gas storage facility would be reduced for a period of up to six months.

“For perspective, Rough inventories hit a record high in early November last year,” said Platts’ European Gas Editor Nathan Richardson.

As such there remains a possibility that Rough may be able to inject gas at the beginning of the winter period in October and November once the capacity restriction ends and before the higher demand months of January and February.

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.

For more information on electric power or the methodology used by Platts in its power assessments, visit the Platts

* The Platts 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.

About Platts: Founded in 1909, Platts is a leading global provider of energy, petrochemicals, metals and agriculture information and a premier source of benchmark prices for the physical and futures markets. Platts’ news, pricing, analytics, commentary and conferences help customers make better-informed trading and business decisions and help the markets operate with greater transparency and efficiency. Customers in more than 150 countries benefit from Platts’ coverage of the biofuels, carbon emissions, coal, electricity, oil, natural gas, metals, nuclear power, petrochemical, shipping and sugar markets. A division of McGraw Hill Financial (NYSE: MHFI), Platts is based in London with more than 1,000 employees in more than 15 offices worldwide.

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This post was prepared by Solar Thermal Magazine staff.

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