Electricity: Ukraine and Europe October 21 – 25, 2024
Ukrainian Energy Exchange: bilateral contracts market
Last week, UEEX held 23 auctions for the purchase/sale of electricity in the unilateral auction mode, including 5 in commercial sections and 18 in specialized sections. Among the initiators were: Energoatom-Trading, Ukrhydroenergo, DTEK Zakhidenergo, DTEK Dniproenergo, Starokostiantynivtsukor, Guaranteed Buyer, PSOs and DSOs, etc.
Energoatom-Trading initiated the auction, which resulted in the sale of 1195920 MWh of baseload at a weighted average price of UAH 5101,32/MWh with a delivery period of November and 108000 MWh of baseload at a weighted average price of UAH 5131,39/MWh with a delivery period of November 16-30.
Ukrhydroenergo initiated auctions to offer baseload power with different delivery periods for the end of October and November. According to the results of the auctions, the company sold 34510 MWh of baseload at a weighted average price of UAH 5157,37/MWh with a delivery period of the end of October and 46800 MWh of baseload at a weighted average price of UAH 5100,77/MWh with a delivery period of November.
During the review period, DTEK Dniproenergo and Zakhidenergo initiated auctions in accordance with Article 66 of the Law of Ukraine “On the Electricity Market”, where they offered block positions and base load with a delivery period of November. The companies were unable to sell the volume offered.
In addition, in the specialized section last week, Starokonstantinovtsukor initiated an auction in accordance with Article 66 of the Law of Ukraine “On the Electricity Market”, where it offered base load for delivery in the first decade of November. As a result, Strakostiantynivtsukor sold 240 MWh of baseload at a weighted average price of UAH 5001/MWh.
The Guaranteed Buyer initiated the auctions by offering block positions of daytime hours with the delivery period from October 27 to 31, November. According to the results of the auction, the company sold 14500 MWh of block positions at prices in the range of 2857,52-3893,8 UAH/MWh with a delivery period for October and 54000 MWh of block positions at prices in the range of 3729,82-4732,5 for November.
In the commercial sections, the companies purchased/sold individual load electricity.
| Trades type | Sales volume, MWh |
|---|---|
| Auctions pursuant to Article 66 of the Law of Ukraine On Electricity Market | 1 385 470 |
| Commercial section | 26 897 |
| Special sessions for the sale of electricity generated from alternative energy sources | 68 500 |
| In total | 1 480 867 |
As of October 25, prices for the most commonly used types of sales schedules were formed, as shown in the chart.
Market Operator: day-ahead and intraday markets
During the reporting period, the day-ahead market prices were less volatile compared to the previous week, ranging from 5415,17 to 6438,54 UAH/MWh. Overall, the average weighted average price for the last week increased by 6,9% compared to the same indicator of the previous week and amounted to 6023,95 UAH/MWh. The highest daily price was 6438,54 UAH/MWh on October 19, and the lowest - 5415.17 UAH/MWh on October 20. The volume of sales for the reporting period of October 19-25 amounted to 584,69 thousand MWh (+12,8%).
During the reporting period, prices on the IDM were volatile. The weighted average prices varied in the range of 5476,65 - 6986,46 UAH/MWh, and the average value of the weighted average prices for the reporting period increased by 9,6% compared to the same indicator of the previous period and amounted to 6271,01 UAH/MWh. The total volume of purchases and sales for the reporting period amounted to 36,53 thousand MWh.
European market
Last week, European electricity markets saw higher average price values than the previous week due to a decrease in wind and solar power generation.
European spot electricity prices showed mixed behavior last Thursday. In Germany, a reduction in wind generation led to an 11% increase in DAM prices, which closed at 112,72 EUR/MWh. Meanwhile, in France, the planned restart of three nuclear reactors, which increased nuclear availability by 3,1 GW, led to a price decrease. Thus, the French spot price fell by almost 9%, closing at 59,30 EUR/MWh.
Electricity generation from wind turbines in Europe in the first four days of last week averaged 14,6% of the region’s needs, according to the WindEurope Association. At the same time, the largest volumes on different days were generated by the following countries: Germany and Sweden.
Solar power generation in Europe in the first four days of last week totaled about 2,174 GWh. The Italian market continued its downward trend for the fourth week in a row. The average capacity of solar power generation in Europe in October decreased to 20,7 GW.
Demand for electricity increased in most major European electricity markets compared to the previous week. Demand increased in the Portuguese, Belgian, and Dutch markets and decreased in the German, French, British, and Spanish markets. Over the first four days of last week, the average European demand was 303,7 GW.
In terms of hourly prices, on Sunday, October 20, most of the markets analyzed registered negative hourly prices, which was influenced by the usual decrease in demand on this day of the week and high values of renewable energy production in some cases. The exceptions were the Italian and Portuguese markets. In Germany, Belgium, Spain, France, the Netherlands and the Nordic countries, negative hourly prices were recorded from 13:00 to 15:00. In the markets of Germany, Belgium, France and the Netherlands, the lowest hourly price in the third week of October was -2,01 EUR/MWh on Sunday from 14:00 to 15:00.
As of October 25, the price of basic electricity in France amounted to 59,3 EUR/MWh, in Hungary 115,42 EUR/MWh; in Poland: 127,76 EUR/MWh.
As of November 2024, prices were traded in the range of 81-111 EUR/MWh in the above countries.
Monthly electricity futures for December 2024 increased by 1,7% in France and decreased by 3,2% in Poland and 2,2% in Hungary; for January 2025, they increased by an average of 9.8% in the analyzed countries.
The benchmark German energy contract Cal’25 increased by 2%, closing at 90,81 EUR/MWh, while the French contract Cal’25 increased by 1,6%, closing at 75,38 EUR/MWh.
Futures contract prices, EUR/MWh, 24.10.2024
| Type | Contract | Date | France | Hungary | Poland |
|---|---|---|---|---|---|
| Base | Моnth | Nov/24 | 80,80 | 110,45 | 101,61 |
| Dec/24 | 82,14 | 108,00 | 98,36 | ||
| Jan/25 | 95,13 | 117,76 | 102,70 |
European carbon prices followed the gas market. On Thursday, carbon prices in Europe rose by 3%, reaching their highest level since September 30. EUAs, which expire in December 2024, were set at EUR 66,63 per ton on October 24. The price of carbon emission permits in the EU was trading at 66,35 EUR per ton on October 25.
The European Commission is allocating EUR 4,8 billion from the ETS fund for zero-emission projects. Last year, there were 25 winning clean technology projects in the fund’s competition, which received a total of EUR 1,6 billion. They included nine projects for the production of electrolyzers, nine projects for the production of renewable energy components, including for photovoltaic panels and wind turbines, and seven projects for batteries. The European Commission plans to announce the next call for proposals on December 3, 2024. The expected budget of the fund is EUR 40 billion for the period up to 2030, depending on carbon prices.
On October 24, the spot price of thermal coal in Europe (API-2) amounted to 109,71 EUR per ton, which is 0,6% higher than the week before last. The market balance has not been disturbed, as demand in the Asian steam coal market is expected to remain subdued due to high stock levels in Chinese ports.
Last week, Ukraine received imports from Hungary, Slovakia, Romania, Poland, and Moldova. Exports were to Hungary, Slovakia, and Romania.
Public procurements
Over the past week, more than 50 electricity procurement tenders were held by customers. Sold volume of the 10 largest contracts amounted to 312,89 million kWh for a total value of UAH 2,08 billion excluding VAT. The average price amounted to UAH 6,18 per kWh, excluding VAT. The largest contracts were awarded to Poltavaenergozbut LLC, Energy Investment Group LLC, and SC Energy Group LLC, which will supply 268,04 million kWh, 29,82 million kWh, and 12 million kWh, respectively. Other tenders are shown in the chart below. Prices ranged from UAH 5,72 to 7,11 per kWh.
News from the wholesale electricity market
Ukrainian Energy Exchange announces the opening of a new section for organizing and conducting electronic auctions for the purchase and sale of guarantees of origin of electricity generated from renewable sources. The auctions will be held in the Exchange Electronic Trading System (ETS) software product in the Electric Power version in the form of a one-sided counter auction. Registered users of the register of guarantees of origin, who have received the status of seller and/or buyer after registration on the UEEX, can participate in the auction. Initiators can place purchase or sale orders by attaching draft contracts to their positions. The auction can form positions of guarantees of origin with the definition of the type of renewable energy source used in the process of electricity production, the period of electricity production, and the period of commissioning of the generating facility. Auctions can be held both for increasing and decreasing prices. “The introduction of trading in guarantees of origin is an important element in supporting the development of the renewable energy market in Ukraine. It enables market participants to confirm the origin of electricity during its production and consumption. The exchange will ensure transparency, market-based pricing and a convenient service for the purchase and sale of guarantees of origin for market participants. The new tool will be especially useful for companies that prepare ESG reports and seek to reduce their environmental footprint, as well as for suppliers that will offer “green” products to retail customers,” commented Oleksandr Kovalenko, CEO of UEEX.
NEC Ukrenergo is waiting for the decision of ENTSO-E, the Continental European network of system operators, to increase the capacity of the interstate crossing for electricity import, which is currently 1,7 GW, next week. This was announced by Acting Chairman of the Board of NEC Ukrenergo Oleksiy Brekht, Interfax-Ukraine reports. “The final approvals and calculations are being completed, and next week we will indeed have a corresponding increase,” he said during a speech at Energy Day-2024 by the European Business Association. Brecht also noted that the position of the European colleagues is to continue work on further capacity building after this decision is made. As Ukrainian Energy reported earlier, over the past few months, Ukraine has issued technical specifications for connection of distributed generation facilities with a total capacity of up to 1,3 GW to the transmission system. "Ukrenergo received a powerful transformer for the substation from its partners. The new equipment will provide a reliable power supply scheme for about 300 thousand consumers.
