Market talk
Nasdaq rebuffs claims it misled market over Aas portfolio Nasdaq Clearing has rebuffed claims by Sweden ’ s financial watchdog that its actions had exposed market players to unnecessary risk when selling off power trader Einar Aas ’ s portfolio in the wake of his default in 2018 . According to Sweden ’ s financial watchdog , Finansinspektionen , the Stockholm-based Nasdaq clearing house had exposed its members to illegal risks and partly misled the market in its handling of the case . In its investigation of the incident , which concluded late in January , the watchdog pointed out that Nasdaq Clearing did not fully divest Aas ’ s portfolio until June 2019 , nine months after his default . It fined Nasdaq EUR 30m over its handling of the issue . GOM , AT
Nordic financial power volumes jump 14 % to 932 TWh in 2020 Nordic financial power volumes traded and cleared on the Nasdaq Commodities exchange rose 14 % last year to 932 TWh , recovering from the 21-year low hit in 2019 , amid record low prices . Trades conducted directly on the exchange climbed 30 % to 506 TWh , while the volume of cleared OTC trades edged up 0.5 % over the period to 426 TWh . Nordic power prices fell to record low levels in 2020 amid a swelling hydrological surplus and higher wind power output thanks to a renewables expansion in the Nordic region . GOM
Norway power production hits record high in January Power production in Norway totalled 17.5 TWh in January , a new record for a single month , Nord Pool figures showed . The fresh high came amid record monthly
10 hydropower output of 16.5 TWh , with the remainder coming primarily from wind power . The previous monthly high was 16.4 TWh in January 2016 , of which 15.9 TWh was hydropower . RF , GOM
Nord Stream 2 still hangs in balance Russia ’ s plans to complete its Nord Stream 2 gas pipeline to Germany hang in the balance following the start of stiffer US sanctions . More European companies have ended their involvement since the start of the year after Washington extended potential punitive measures to insurers and project certifiers . Gazprom initially hoped to complete the 1,230km link last year but it still needs 150km of pipes through Danish and German waters . The new US administration has flagged an intention to seek a negotiated solution . Germany may have to guarantee it would refuse Nord Stream 2 supply in the event of a Russian gas dispute with Ukraine , local media have reported . “ What will come out of these talks will define the fate of the pipeline ,” Maria Shagina , an energy specialist on eastern Europe at Zurich University , told Montel . NW
Forward curve implies early end to German lignite German utilities may be forced to close lignite-fired power plants well before an official exit amid a devastating outlook for their future margins , said energy economist Felix Matthes , highlighting plunging margins for old German lignitefired generation to unsustainable levels last year . Forward power and carbon prices left them on track to remain there until beyond 2025 . He estimated the profitability of lignite-fired plants built or retrofitted before 1995 began earning less than EUR 5 / MWh in 2020 . Germany ’ s schedule for closing lignite plants foresees operating its oldest units to 2029 . RWE , which owns around half of Germany ’ s remaining lignite plants , has hedged its carbon exposure at lower levels than prevailing prices well into this decade . “ If this market environment continues , the operators / owners have to find an economic answer on this at the latest when the existing hedges expire ,” said Matthes . NW
German power could be carbon neutral by 2040 – Altmaier German power generation could reach carbon neutrality around 2040 despite forecasts of rising demand and just two years after the country ’ s final coal exit , said economy and energy minister Peter Altmaier . “ We want Germany ’ s power generation to become 100 % renewable ,” said the minister . He pointed to an increase of the EU carbon reduction target to at least 55 % by 2030 compared with 1990 levels , up from 40 % previously , and the aim to reach overall carbon neutrality in 2050 . AL
German net power exports nearly halve in 2020 Germany ’ s net power exports fell 46.2 % in 2020 to 18.9 TWh amid rising imports from Denmark and Sweden , official data showed . Germany ’ s net exports of nearly 2 TWh to Denmark in 2019 flipped into net power imports of 6.9 TWh in 2020 , making the northern neighbour the top power supplier to the country last year , data from the BNA network regulator showed . It pointed to a shift in power prices and higher transmission capacities between the countries . German day-ahead power prices averaged EUR 30.47 / MWh in 2020 , while western Denmark saw an average of EUR 24.98 / MWh and eastern Denmark saw EUR 28.41 / MWh , exchange data showed . In 2019 , Denmark had higher average prices than Germany . AL
Tighter LNG market sparks hope for European storage players Europe ’ s growing reliance on a tightening global LNG market spells welcome news for struggling gas storage operators . “ We are
Gas market volatility here to stay – energy firms
Europe ’ s gas market has experienced significant volatility over the past year , and this is set to continue , but the region ’ s “ well-functioning ” infrastructure should negate the impact on security of supply , market participants said . “ We have seen very sharp [ price ] swings in recent weeks ,” said Franco Magnani , head of equity valorisation at Eni . The volatility had been for “ all the right reasons ”, such as unusually cold weather in the Far East and congestion in the Panama Canal , although a lack of liquidity still meant “ a few cargoes can move the market a lot ”, he added . Maria Rita Galli , executive vice president for business development at Italian infrastructure operator Snam , noted Europe had weathered the price volatility relatively well over the past years . LW
Montel Magazine 1 – 2021