Montel Magazine 4 2021 - Nordic power spat - Page 8

Green energy developers in Poland eye PPAs as prices soar

Market talk

Nasdaq urges fewer Nordic bidding zones to boost liquidity The Nasdaq Commodities exchange has urged a reduction in the number of bidding zones in the region to help improve falling liquidity in the financial power market , said Georg Aasen , CEO of the bourse ’ s Norwegian arm . “ Today ’ s separation into 12 bidding zones , where some have a very low correlation to the joint Nordic system price , makes long-term price hedging very difficult ,” he said . “ It also deters financial players from entering the market .” His comments came as Nasdaq saw 685 TWh of Nordic power derivates traded or cleared through the exchange from January-October , down 6 % year on year . “ I am convinced market liquidity would have been significantly higher with fewer and larger bidding zones ,” said Aasen . OV
Finland ’ s 1.2 GW reactor plans on track – Fennovoima CEO Finland ’ s plans to launch the proposed Hanhikivi 1 nuclear power plant in 2029 remain on track , said CEO Joachim Specht of developer Fennovoima , dismissing speculation it could be derailed . Funding disagreements , a risk analysis request by the Finnish defence ministry and uncertainty surrounding EU taxonomy rules for what constitutes clean energy have all recently clouded Finland ’ s plans to develop the 1.2
GW nuclear plant using a Russian-built reactor . CEM
Hydrogen to drive Nordic power demand – TSOs The Nordic region is set for a 65 % rise in power demand to 655 TWh by 2040 , with green hydrogen production contributing the most , according to a scenario published by regional TSOs . They expected power demand from hydrogen and other energy conversion and storage facilities to rise from close to zero in 2020 to 108 TWh by 2040 , with Sweden leading the way due to ambitious targets for “ clean ” steel production based on hydrogen . Power demand from existing and new industries would likely rise from 131 TWh in 2020 to 179 TWh in 2040 , while demand from transport was expected to increase from 3 TWh to 51 TWh and data centres from 2 TWh to 35 TWh , according to the report from Statnett , Svenska Kraftnat , Energinet and Fingrid . In contrast , household consumption was set to drop by 8 TWh due to improved energy efficiency . OV
German green plans to increase price volatility – Volue Plans by the new German government to expand renewable energy capacity would “ significantly increase seasonal power price volatility ”, said Volue analyst Konstantin Lenz . During the winter , new gas plants – which have higher generation costs than coal – would see power prices spike , he added , after the government revealed it would exit coal by 2030 and look to secure 80 % of gross power demand from renewables by then . In summer , meanwhile , increased solar capacity would weigh on prices , said Lenz . The targets unveiled by the new coalition would lead to average spot power prices in the first quarter of the new decade of EUR 96 / MWh , compared with EUR 81 / MWh based on the original coal exit scenario of 2038 , according to Volue analysis . The second quarter , however , would see prices turning out EUR 10 lower at EUR 33 / MWh , the third quarter EUR 8 lower at EUR 50 / MWh and the October-December period up EUR 5 at EUR 44 / MWh .
Other observers have also described the coalition ’ s renewable energy plans – which almost quadruple solar and offshore wind capacity in eight years – as extremely ambitious . JD
Germany , Austria sign gas supply security deal Germany and Austria have signed a deal to ensure gas supply between the two countries in case of unexpected shortages . “ In the extremely unlikely event of an extreme gas shortage , we have defined in the agreement the procedure for how Austria and Germany can help each other quickly ,” said Germany ’ s outgoing state secretary Thomas Bareiss . It was the second deal of this type , after Germany signed a similar agreement with Denmark a year ago . CD

Green energy developers in Poland eye PPAs as prices soar

Renewable energy developers in Poland are turning to power purchase agreements ( PPAs ) and the wholesale market as rising electricity prices deter demand for state-backed contracts for difference ( CFDs ), said an adviser at risk management firm Pexapark . Renewable developers who bid in auctions for CFDs in Poland were currently reluctant to hedge all of their output in these tenders in the first four years after launching the renewable plant because of rising market prices , said Grzegorz Skarzynski . Therefore , some developers were opting to use a ” hybrid approach ” of PPAs or buying in the wholesale market together with CFDs . MC
10 Montel Magazine 4 – 2021