Nordic Front-Month Set for Second Session Decline

The Nordic front-month baseload power contract closed at a July low on Wednesday as the European power curve was in red territory amid price declines in TTF. The contract could fall lower today as the German equivalent is trading down in the morning – to track falling EU ETS and European gas.

• Nordic Base Power AUG 24 closed down 4.9% at 31.9 EUR/MWh on 3 July.
  
• Germany Base Power AUG 24 down 0.7% at 75.22 EUR/MWh
• EUA DEC 24 down 0.7% at 70.25 EUR/MT
• TTF Gas AUG 24 down 0.7% at 32.45 EUR/MWh.
• Nordic nuclear reactors were operating at 78%, down by just 1 percentage point on the day, with the return of the 1.07GW Ringhals 3 anticipated on 13 July – increasing nuclear availability.
• However, maintenance at several nuclear units – Forsmark 1, Ringhals 4 and Loviisa nuclear units – are still expected over August – lowering baseload generation and could potentially pressure hydro stocks.
• And Nordic hydropower reserves rose by just over two percentage points last week (week 26) to 67.8% of capacity, or 86.02TWh, slowing down weekly increases seen in the week before and flipping to a deficit to the 19-year average.
• But the Nordic hydro balance – which measures the relationship between the quantity of water inflow and outflow – has been revised by up to 400GWh over 4-18 July, which could support stocks over the period, according to ECMWF.
• Closer in, average temperatures in the Nordics are expected to be below the 30-year norm of around 17C over 4-9 July before being slightly above over 10-13 July- where temperatures peak at around 18.7C.
• Norwegian wind is anticipated at a 23% load factor, or 1.19-1.23GW on 5-6 July – which could weigh on power prices on delivery –, with stronger wind anticipated over 7-8 July at between 1.47-1.84GW, according to spot renewables.