EUAs reversed from early sharp correction

The power spot prices surged for today in northwestern Europe, lifted by forecasts of below-average temperatures, low French nuclear availability and weak renewable generation. The day-ahead prices averaged 271.95€/MWh, +51.11€/MWh from Friday and +43.20€/MWh week-on-week, with prices rising up to 301.12€/MWh in France due to the higher temperature sensitivity of the country’s power demand.

The carbon prices opened on Friday with a sharp correction, the Dec.21 falling by 3.47€/t to the day’s low of 70.59€/t in the first hour of trading as the energy complex and financial markets were driven down by the increasing worries over the new South-African covid strain. The EUAs however quickly reversed and proceed to get back most of their early losses throughout the remainder of the day, pointing to a still strong buying interest from participants despite the record prices and bullish rally observed over the past three weeks. After a late and slight retreat, the EUA Dec.21 eventually closed at 72.78€/t, -1.68€/t from Thursday’s settlement but +3.42€/t (+5%) from the previous week. Emissions prices are however rising this morning alongside the oil market and already hit a new record above 75€/t.

The power forward prices observed a significant drop on Friday morning as well, tracking the falling gas and carbon prices. If the French prices managed to rebound and eventually post moderate daily gains, the other NWE countries failed to recover and settled lower than the previous day.