FR Baseload Power price (€/MWh)

FR Peak load Power price (€/MWh)

EUA price (€/t)

PEGN Gas price (€/MWh)

Coal Price ($/Tn)

Gas efficiency:52%; Coal efficiency: 38% 

Gas vs. Coal Price (€/MWh)

Gas efficiency: 52%; Coal efficiency: 38%

Clean Spark Spread – Baseload (€/MWh)

Clean Spark Spread – Peak load (€/MWh)

Clean Dark Spread – Baseload (€/MWh)

Clean Dark Spread – Peak load (€/MWh)

April 2022

Market Analysis

Prompt and month-ahead contracts:

Despite a rather cold start, the month of April saw FRA electricity demand average c. 55.9GW at the max, down by a further 7.2GW m-o-m, on the back of overall milder temperatures and reduced consumption during the Easter holiday break.

In terms of generation, nuclear power output averaged 31GW at the max, down by 5.67GW m-o-m and c. 7.6GW when compared to the same month last year, putting the reliability of FRA´s nuclear fleet into question once again (and exacerbated further by EDF´s announcement that it had found signs of possible corrosion issues on the auxiliary circuits of four of its nuclear reactors totalling 4.8GW). As for fossil-fuelled production, gas generation was down by an average 1.7GW at the max, whereas coal output was rather stable. Regarding renewables, no major changes were observed in terms of hydro and wind power production. However, solar power generation, though up by an average of just 1GW at the max m-o-m, showed rather healthy values during wk8 and reached a new all-time high of 9.7GW at the max on Tue, Apr 24th

As for gas prices, TTF spot contract reversed the overall trend observed during our previous analysis. In fact, after starting April on a bullish note supported by a short-lived cold snap, the contract gradually lost ground namely on the back of forecasts pointing to milder weather conditions and prospects of healthy LNG cargo deliveries into Europe. The bullish impact resulting from news that RUS had stopped gas supply to Poland and Bulgaria on Wed, Apr 27th (on the grounds both countries refused to pay for gas supplies in rubbles), was equally short-lived, with TTF spot contract adding EUR7.83/MWh d-o-d and retreating thereafter. Eventually, the contract was down by an average EUR26.841 m-o-m after closing at EUR96.432/MWh on Powernext on Sat, Apr 30th.

FRA spot power prices were also seen following an overall downward trend in April. Milder temperatures, especially during the last week of the month, decreasing gas prices and EUAs contracts keeping below the EUR80.00/Tn mark during the first half of the month, all weighted on the contract. The only significant bullish move was observed on Mon, Apr 4th, with FRA power baseload contract settling at EUR551.43/MWh (+74% when compared to Fri, Apr 1st) on the back of very cold temperatures (demand registered 71.6GW at the max) and nuclear power generation reaching no more than 32.1GW at the max (with 27 out of 56 nuclear reactors out of service). By COB of Sat, Apr 30th, FRA power baseload contract was down by an average EUR61.99 m-o-m after closing at EUR200.93/MWh. Its equivalent peak load contract closed at EUR191.74/MWh, down by EUR71.40.

Regarding month-ahead contracts, FRA May’22 power baseload contract was down by an average EUR62.72 m-o-m after closing at EUR212.60/MWh on the EEX on Fri, Apr 29th. Despite some reduced NOR gas pipeline supply (due to maintenance outages) and lower flows from RUS, plus RUS having cut flows to Poland and Bulgaria, a milder weather outlook and strong LNG supply into Europe managed to bring power prices down. It´s worth noting here that LNG prices for delivery into Europe are at their largest discount to TTF gas prices (c. EUR29.00/MWh against almost zero 2.5 years ago). Lingering concerns that RUS might cut gas pipeline supply to more European countries and a slowdown in China´s demand for LNG due to newly decreed confinements has led to a glut in cargoes waiting to be discharged at European ports in the context of very tight slots availability. As a result, cargo owners are forced to offer discounts to deliver their supply to those buyers that have managed to contract regassification slots. For its part, FRA Jun’22 power baseload contract closed at EUR222.13/MWh, down by an average EUR56.38 m-o-m.

Medium and long-term contracts:

FRA power curve contracts were mostly on the up, supported by the impact current geopolitical tensions and, more specifically, resulting measures being proposed by the EU (such as an EU-wide full embargo on RUS energy exports) are having on the whole energy complex. To this we should also add ongoing concerns regarding the reliability of FRA´s nuclear power fleet. Although EDF is confident it will be able to return c. 20GW capacity to the grid for the coming winter, the market deems this news as unreliable and unrealistic given the ongoing issues the French nuclear fleet keeps facing. Nor does it help that France´s recently re-elected President Macron, in a bid to attract both pro-nuclear and pro-renewables voters, had promised, amongst others, to 1) develop nuclear, solar and wind generation assets more than ever, and 2) make France “the first major nation to abandon gas, oil and coal”. Even if these pre-election promises were to be fulfilled, it will take time to do so, and time is something the FRA power system cannot afford under the current circumstances.

In light of the above, it comes as no surprise that FRA Q422 power baseload contract was up by an average EUR11.31/MWh when compared to March, whereas both FRA Cal23 and Cal24 power baseload contracts added on average EUR34.51/MWh and EUR35.03/MWh m-o-m, respectively.

In terms of underlying fuel costs, TTF Cal23 gas contract added an average EUR7.432 m-o-m after closing at EUR78.770/MWh on Powernext on Fri, Apr 29th. Though still bullish, the level of prices observed was not as high as those seen in March. This may be the result of some confidence gained by market players in view of: 1) currently increasing LNG cargoes waiting to be discharged at European ports (at prices significantly lower to the TTF reference price); 2) NOR´s announcement that it would increase the amount of gas to be exported to NWE and, 3) efforts made by various EU countries to reduce their reliance on RUS gas by either increasing the capacity of some of their existing regasification plants, lease some floating units, or build some new facilities. In the specific case of France, latest news suggest that the Fos-Cavaou terminal will see its capacity increased by 13TWh in 2023 and 30TWh in 2024, while plans for increasing capacity at the Dunkerque terminal are currently under study. Meanwhile, a decision on whether to invest in an LNG floating terminal at Le Havre is also on the cards …

As for coal prices, API2 Cal23 contract added $29.17 m-o-m after closing at $209.93/Tn on the ICE on Fri, Apr 29th. The contract followed a bullish trend during the first 3 weeks of the month, supported by concerns that the EU would impose a ban on coal imports from RUS. This decision was officially confirmed by the EU on Apr 8th and entered into force on Apr 9th (note here that contracts concluded before Apr 9th and ancillary contracts necessary for their execution may still be executed until Aug 10th). This EU measure also had an immediate bullish impact on Asia-Pacific coal indexes (also supported by the US embargo on purchasing RUS materials). However, the last week of the month saw API2 Cal23 contract prices shed some ground on the back of increasing stocks.

Finally, re. emissions prices, EUA Dec22 contract closed at 84.45/Tn on the EEX on Fri, Apr 29th, up by an average EUR6.59 m-o-m. Emissions prices traded rangebound during the first two weeks of April (settling between EUR77.00-80.00/Tn), and volumes thinning considerable ahead of the Easter holiday period. However, EUA Dec22 contract took a bullish turn starting on Wed, Apr 20th, supported by some market players who started to feel the stress to meet their 2021 obligations (compliance period was due at the end of the month) plus some speculative trading.

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Expérience professionnelle

Céline, jeune active dynamique, a fait ses premiers pas dans le monde du travail dans le domaine du tourisme en tant que community manager au Loups du Gévaudan, en Lozère. En rejoignant l’équipe HES en novembre 2021, elle a souhaité diversifier ses connaissances : se former dans le secteur énergétique, se spécialiser dans les stratégies marketing afin de développer les relations clients de l’entreprise ; tout en approfondissant ses compétences en coordination et gestion de projets.

Formation

Céline est diplômée d’une double licence Espagnole – Anglais en Langue, Littérature et Civilisation Etrangère à la Sorbonne IV (2018). Elle a aussi obtenu un Master II en Direction de Projets ou Etablissements Culturel, spécialité Tourisme International. Elle a également étudié à l’étranger, à University of London (Angleterre) et Universidad de Morón (Argentine).

Céline Haya Sauvage

Responsable Marketing

DSC_0323
« La décarbonisation des secteurs de l’énergie et des transports est sans doute aujourd’hui le principal moteur économique de l’industrie. »

Expérience professionnelle

Il a débuté sa carrière dans le génie civil en tant que chef de projet en France, en Martinique et en Australie. Par la suite, il devient directeur général d’une filiale au Venezuela. En 1992, il crée une filale pour Dalkia en Allemagne (chauffage urbain, cogénération et partenariats) et représente Véolia en Thaïlande. En 2000, il a ouvert le bureau commercial d’Endesa en France pour profiter de la libéralisation du marché de détail. A partir de 2006, en tant que responsable du développement chez Endesa France, il a dirigé le plan d’Endesa pour la production à cycle combiné gaz en France et a simultanément développé le portefeuille éolien et photovoltaïque de la Snet. Philippe Boulanger a ensuite travaillé pendant 3 ans au siège d’E.ON pour coordonner les activités de l’entreprise en France. Il a été fortement impliqué dans le projet français de renouvellement de la concession hydroélectrique. En tant que Senior Vice President – Project Director chez Solvay Energy Services d’avril 2012 à février 2014, il était en charge des projets de déploiement H2/Power to gas et d’accès direct au marché européen. Philippe est un expert pour HES depuis 2014.

Formation

Philippe Boulanger est ingénieur diplômé de l’Ecole Polytechnique et de l’Ecole Nationale des Ponts & Chaussées (France) et possède une expérience combinée de plus de 25 ans en énergie et infrastructures. En plus de l’anglais, M. Boulanger parle couramment le français, l’allemand et l’espagnol.

Philippe Boulanger

Electricity Expert

HES-Philippe-Boulanger
« Le monde est en train de changer. De nouveaux investisseurs accordent une attention particulière au secteur de l’énergie alors que les acteurs historiques adaptent leur position sur le marché. »

Expérience professionnelle

Antonio a commencé sa carrière dans le secteur de l’électricité en 1991 en tant que membre de l’équipe du directeur général de Sevillana de Electricidad (Espagne). En 1997, il était responsable de la réglementation commerciale chez Endesa Distribution. En 2000, il rejoint le département M&A européen d’Endesa. Il a été nommé CEO d’Endesa Power Trading Ltd en 2003. En 2004, il devient Directeur de la gestion de l’énergie de la SNET (France) et en 2008, il est nommé Directeur Général de cette société. En 2009, il a occupé le poste de Directeur du Développement Entreprise d’E.ON France. En 2011, il a fondé Haya Energy Solutions (HES), une société de conseil qui aide les entreprises à optimiser leur chaîne de valeur : de la définition de la stratégie aux opérations quotidiennes, en s’appuyant sur une solide expérience et une bonne compréhension de l’industrie de l’énergie. De 2015 à 2018, Antonio a été Président de Celest qui opère 2 CCGT françaises (420MW chacune), détenues par KKR. Fin 2018, il rejoint Asterion Industrial Partners, un fonds d’investissement dédié aux infrastructures, en tant que partenaire opérationnel.

Formation

Ingénieur industriel de l’Ecole Supérieure d’Ingénieurs de Séville (Espagne) et titulaire d’un MBA de Deusto (Espagne).

Antonio Haya

CEO