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of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
NATURAL GAS
Lower natural gas prices have driven fuel-switching by European power generators but the potential for a further decline in coal-fired generation is now very limited according to S&P Global Commodity on 9 June.
- "The dynamics of the market have changed. Coal is just not cost-effective. Even with the current multi-year low coal prices, it's still cheaper to switch to gas," said a S&P Global source.
- European gas prices have moved deep into the lignite-to-gas and coal-to-gas switching channels in recent weeks. In late May and early April, day-ahead German THE hub prices fell to the level needed for a 50%-efficient gas-fired units to compete with modern 43%-efficient lignite plants.
- Prices are still in the switching channel despite recent gas prices rises allowing 50%-efficient gas units to replace a 40%-efficient lignite unit in the merit order.
- S&P Global sees little scope for a further decline as hard coal dispatch has already reached must-run levels.
Source: S&P Global
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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