Evolution of demand and production mix: 

In March 2024, electricity consumption in France during peaks in demand averaged 57.9 GW, down 4.4 GW from February levels (61.3 GW). Due to particularly mild weather, the winter holidays and the Easter holidays, which together finally take up almost half of the month of March, the demand for electricity has decreased considerably. The monthly peak in electricity demand was reached on Wednesday, March 4, at 67.5 GW, 15.8 GW less than the 83.5 GW seen in January but in line with the demand seen during February. Alongside this decrease in demand, average electricity prices for base contracts in France saw a decrease of around €5/MWh, from €58.1/MWh in February to €53.56/MWh in March. 

An overview of electricity generation shows, according to RTE data, that nuclear generation averaged 41.9 GW, 3 GW less than in February. 

Wind power generation was lower than in February and January, but solar and hydro were up. 

For gas, the share in the electricity generation mix was higher than in February but not enough to drive up the prices (due to such low demand and a higher net renewable mix). 

Finally, France was a net exporter of electricity, particularly in the second half of the month, weeks 11 to 13, often well above 12 GW and reaching a maximum of more than 17 GW on March 15. 

In terms of renewable energy generation, there was an increase of 1 GW in the average during the maxima in March compared to February, reaching 31.6 GW. This increase was due to both the increase in solar energy (+46%, from 6 GW to 8.8 GW) and the increase in hydropower generation (+3%, from 13.8 GW to 14.2 GW). Hydroelectric stocks are lower than the previous 2 years, 1,267 GWh compared to the 1,508 GWh of 2023 and 1,335 GWh of 2022. This fact can also be explained by a drought situation in several regions of France that did not begin to improve until mid-March when the country experienced a period of more humid weather than normal. 

Futures and one-month ahead contracts: 

 In terms of gas prices, the TTF spot contract closed at €27.7/MWh in March, around 11% higher than the February close (€24.88/MWh), and 32.8% lower than the €41.23/MWh seen at the end of November. This is partly due to the relatively low energy demand this winter and to the very high gas reserves. Although the instability in the Red Sea, highlighted in our monthly analyses over the past few months (well before the media coverage of the Houthi attacks), has had an upward impact on energy prices, the continent’s gas reserves remain very high and Europe is finding sufficient imports from Norway and the United States. It should not be forgotten that the major price increase seen in 2023 took place in the summer and not in the winter (they increased by more than 40%, following the strikes at Australian LNG terminals). 

 May 24 Oil contracts rose steadily from $78.7/bbl to $86/bbl, rising by almost $3/bbl during the month of March. As a result, one-month contracts have moved above the World Bank’s forecast of $81/bbl for 2024. 

 Peak spot electricity prices in France in March were relatively unstable; they remained between €4.86 and €84.76/MWh, volatile compared to February when they had fluctuated in the much thinner range of €31.33 and €79.26/MWh. However, this change is explained by the drop in demand and the milder temperatures typical of late winter. As a result, average monthly peak electricity prices decreased in March from an average of €62.29/MWh in February to €51.86/MWh, even lower than in December.  

 As for electricity futures, in February we saw the April 2024 contract trended downward, from €61.28/MWh on February 1st to €50.15/MWh on February 29th and in March it finally decreased to €30.09/MWh on March 28th, in line with a broader downtrend at the EU level. A similar trend is seen for the May 2024 contract, decreasing from €46.81/MWh on March 1st to €29.17/MWh on March 28th. 

 Medium and long-term contracts: 

The TTF Cal25 contract, which had fallen in February, is rising again, stabilising at a higher level, from €29.38/MWh to €31.37/MWh, but still below €33.18/MWh seen in January.  

Coal prices have been on an upward curve, API Cal25 prices increase was more than 12%, rising from $104.42/t on March 1st to $117.68/t on March 28th. 

On the other hand, EUA Dec’24 prices, which had fallen during January and February, rose during March, but did not reach the January closing price, rising from €56.0/t on 1st March to €61.8/t on March 28th. 

The French electricity contract Cal25 continued the general upward trend of other products such as CO2 and TTF gas from €73.87/MWh to €77.2/MWh, which was not enough to maintain the CSS level which fell slightly during March. Except for coal, which has been trending upwards in recent months due to other dynamics, the other upward trends in long-term contract prices during March can be partially explained by dynamics in France, namely lower confidence in nuclear availability due to new corrosion problems found on some reactors such as Blayais 4 and to low hydro stocks.