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German spot contracts fall on wind supply gains

German spot contracts fall on wind supply gains

The German spot electricity contract for Friday dropped sharply on Thursday, as the wind power supply and demand were expected to increase due to warmer weather.

As of 0923 GMT, the German baseload was down 37.1% to 67 euros per Megawatt Hour (MWh). The French baseload day-ahead was not traded with a range of bids and asks between 21 euros to 25.25 euros.

According to LSEG analyst Naser Hahemi, the combination of a rise in wind power and a decline in consumption in Germany on Friday resulted in a reduction in residual load day-over-day.

LSEG data shows that the German wind output will increase by 13.2 gigawatts to 18.3 GW this Friday. In France, it is estimated to rise by 4.3 GW up to 11.5 GW.

The French nuclear capacity has increased by one percentage point, to 79%.

LSEG data shows that power usage in Germany will drop by 1.7 GW to 57.1 GW, as temperatures are expected to increase 3.4 degrees Celsius in Germany to 11.4C.

RWE, Germany’s largest utility, announced it would reduce investments by over a fifth through the end of this decade. The company cited global uncertainty about the returns on renewable energy that has forced other major players in the sector to cut back their spending plans.

LSEG data shows that demand in France is expected to drop 3.1 GW, to 51.4 GW. However, temperatures will rise by 1.6C on average to 14C.

The German power contract for 2026 was down 0.7% at 64.40 Euros/MWh, while the French baseload contract fell 0.7% to 86.25 Euros/MWh.

Benchmark European carbon permits dropped 0.2%, to 73.30 Euros per metric ton.

Volodymyr Zelenskiy, the Ukrainian president, said that the energy war between Ukraine and Russia can be stopped quickly. However he warned that Ukraine will respond in kind should Moscow break the limited ceasefire. (Reporting and editing by Sonia Cheema; Forrest Crellin)

(source: Reuters)