Electricity: Ukraine and Europe 6 – 10 May, 2024
Ukrainian Energy Exchange: bilateral contracts market
During the last week 9 auctions for purchase and sale of electricity on unilateral auction mode were held at UEEX, of which 5 in commercial section, and 4 in specialized. Among the initiators are: Guarranteed buyer, Ukrhydroenergo, Euro-reconstruction, USP and DSO.
Ukrhydroenergo initiated auctions to offer baseload power with different delivery periods. As a result, the company sold 71280 MWh of baseload at prices in the range of 3502,11 - 3994,29 UAH/MWh with delivery in the second half of May.
In addition, in the specialized section last week, Euro-Reconstruction initiated an auction in accordance with Article 66 of the Law of Ukraine "On the Electricity Market", where it offered base load. As a result, the company sold 15120 MWh of baseload at a weighted average price of 3835,33 UAH/MWh with delivery in the second and third decade of May.
During the reporting period, the Guaranteed Buyer initiated the auction, offering block positions for daytime hours with delivery in the second decade of May. As a result of the auction, the company sold 29000 MWh of block positions at prices in the range of UAH 1410,5 - 2713,8 MWh.
In the commercial sections, the companies bought/sold electricity of individual profiles load.
| Trades type | Sales volume, MWh |
|---|---|
| Auctions pursuant to Article 66 of the Law of Ukraine On Electricity Market | 86 400 |
| Commercial section | 41 476,407 |
| Special sessions for the sale of electricity generated from alternative energy sources | 29 000 |
| Totaly | 156 876,407 |
As of May 10, prices for the most commonly used types of sales schedules were formed, as shown in the chart below.
Market operator: day-ahead and intraday markets
During the reporting period, the day-ahead market prices were volatile, ranging from 3396,31 to 4880,57 UAH/MWh. Overall, the average weighted average price over the past week increased by 8,9% compared to the same indicator last week and amounted to 4055,05 UAH/MWh. The highest daily price was 4880,57 UAH/MWh on May 9, and the lowest was 3396,31 UAH/MWh on May 6. The volume of sales for the reporting period of May 4-10 amounted to 419,42 thousand MWh, (-4%).
During the reporting period, prices on the DAM were volatile. The weighted average prices varied in the range of 3649,74 - 5027,04 MWh, and the average value of the weighted average prices for the reporting period increased by 12% compared to the same period last year and amounted to 4093,65 UAH/MWh. The total volume of purchases and sales for the reporting period amounted to 48,61 thousand MWh.
European market
In the second week of May, weekly averages were higher compared to the previous week in most of the analyzed European electricity markets, despite public holidays.
Last Thursday, electricity prices on the DA moved in different directions, and European carbon prices rose by more than 2% on the day due to active technical trading. The day-ahead electricity price in Germany jumped 23% to EUR 75,99/MWh due to a decline in solar capacity. On the contrary, the equivalent contract in France fell by 23% to EUR 13,92/MWh due to a sharp increase in renewable energy sources. Y+1 electricity prices also rose along with rising gas and carbon prices.
Electricity generation from wind turbines in Europe in the first four days of last week covered 9,8% of the region’s needs, according to the WindEurope Association. The leading countries were Spain, Italy and France. Spot electricity prices are expected to fall this week as wind power returns to normal levels.
The drop in demand in European markets during the second week of May was largely due to the May 9 holiday, which was celebrated in most European countries. Demand continued to decline in the markets of France, the UK, Belgium, Germany, the Netherlands and Portugal.
Temperatures in most of Europe are above seasonal norms, without reaching extreme levels when the need for cooling prompts an increase in electricity generation.
As of May 9, the price of basic electricity in France amounted to 13,92 EUR/MWh; in Hungary: 70,27 EUR/MWh; in Poland: 98,44 EUR/MWh.
As of June 2024, electricity was traded in the range of 50 - 94 EUR/MWh in the analyzed countries.
Monthly electricity futures for July 2024 increased by an average of 16% in France and Hungary and decreased by 8% in Poland. As of August 2024, prices increased by 7% on average in Poland and Hungary, and decreased by 5,2% in France.
On Friday, weekend power contracts traded lower in the UK at GBP 62/MWh (6,2 pence/kWh) as wind production continued to rise.
Germany’s benchmark energy contract Cal ’25 rose 2% to 95,10 EUR/MWh, while the equivalent contract in France rose 2% to settle at 83,85 EUR/MWh.
Futures contract prices, EUR/MWh, 09.05.2024
| Type | Contract | Date | France | Hungary | Poland |
|---|---|---|---|---|---|
| Base | Моnth | Jun/24 | 50,42 | 74,85 | 93,96 |
| Jul/24 | 62,76 | 81,00 | 86,37 | ||
| Aug/24 | 59,48 | 83,03 | 96,03 |
The estimated price for carbon emissions in Europe last Thursday, May 9, was 73,26 EUR per tonne, which is about 1% higher than the price the day before last Thursday. On May 10, in the morning, the EUA’24 price was trading at 74,2 EUR per ton.
On May 9, the spot price of thermal coal in Europe (API-2) amounted to 99,74 EUR per ton.
Last week, stocks at the key ARA import terminals (Amsterdam, Rotterdam, Antwerp) amounted to 5,3 million tons, compared to about 6 million tons at the same time last year, as ship arrivals slowed amid low production demand.
Last week, electricity was imported from Slovakia, Romania, Moldova, Hungary, and Poland. Exports were directed to Romania, Hungary and Slovakia.
Public procurements
Last week, 7 tenders were held for the purchase of electricity by budgetary institutions for a total amount of more than UAH 108,17 million, excluding VAT. Sold volume of all contracts amounted to 27,79 million kWh. The average price was UAH 4,27 per kWh, excluding VAT. The largest contract was awarded to Ukrgaztrading LLC, which will supply 25,25 million kWh of electricity to the State Enterprise "Ukrainian Sea Ports Authority" at an initial price of UAH 3,88 per kWh, excluding VAT. Other tenders are shown in the graph below. Prices ranged from UAH 3,58 to 5,95 per kWh.
News from the wholesale electricity market
Two new power units to be built at South Ukraine NPP
NNEGC Energoatom plans to complete two power units based on Westinghouse’s AR1000 technology at the South Ukrainian Nuclear Power Plant, which currently operates three VVER-1000 power units with a total capacity of 3000 MW. In particular, it is planned to start engineering survey and pre-design work now. It is noted that preparations for the construction of new power units will be carried out at the expense of Energoatom. As reported, Energoatom plans to complete power units 3 and 4 at Khmelnytskyi NPP, as well as to build power units 5 and 6 there.
The Energy Market Department proposed to increase price lists for "night hours"
On Wednesday, May 8, an open discussion of comments and proposals regarding the revision of price caps in the electricity market (day-ahead market, intraday market, and balancing market) was held. Based on the results of the open discussion, the Energy Market Department proposed the following price caps: On the day-ahead market: maximum price caps from 00:00 to 08:00, from 11:00 to 17:00, from 23:00 to 24:00 - UAH 5600/MWh; from 08:00 to 11:00 - 6900,00 UAH/MWh; from 17:00 to 23:00 - 7500,00 UAH/MWh; minimum price limit - 10,00 UAH/MWh; On the intraday market: maximum price limits from 00:00 to 08:00, from 11:00 to 17:00, from 23:00 to 24:00 - 5600 UAH/MWh; from 08:00 to 11:00 - 6900,00 UAH/MWh; from 17: 00 to 23:00 - 7500,00 UAH/MWh; minimum price cap - 10,00 UAH/MWh; In the balancing market: maximum price caps from 00:00 to 07:00 and from 23:00 to 24:00 - 6600,00 UAH/MWh; from 07:00 to 23:00 - 8250,00 UAH/MWh; minimum price cap - 0,01 UAH/MWh. D.Trading, DTEK Zakhidenergo, Ukrhydroenergo, Zakarpattyaenergozbut, and Dniprostal-Energo submitted their proposals and comments. It is important to note that so far only an open discussion has taken place. The final decision will be made at the NEURC meeting.
