Nordic electricity for next week retreated as the price for power delivered today turned out lower than market expectations.
“All front contracts through February are dropping on the back of a lower-than-expected spot price for today, while the contracts for March and further out are supported by a dry and cold weather outlook,” Arne Oesterlind, a fund manager at Shepherd Energy, said today by phone from Stockholm.
Electricity for delivery around the clock today costs 46.29 euros ($61.91) a megawatt-hour on average, following yesterday’s auction on the Nord Pool Spot AS exchange in Oslo. That’s lower than market expectations of 51.50 euros on average for this week, as reflected by the financial contract for today, which closed on Jan. 11 on the the Nasdaq OMX Group Inc.’s energy exchange in Oslo.
The week-ahead contract lost as much as 3.2 percent to 50.75 euros a megawatt-hour and traded at 51.25 euros as of 11:33 a.m. on the Nasdaq OMX Group’s energy exchange. February power retreated 0.3 percent to 46.80 euros while March power gained 0.4 percent to 41.25 euros.
Low temperatures in Oslo are forecast to drop to minus 20 degrees Celsius (minus 4 Fahrenheit) on Jan. 21 from minus 18 today, according to CustomWeather Inc. data on Bloomberg.
The region’s hydropower reserves are 4.93 terawatt-hours below the seasonal average and may drop further to a deficit of 11.6 terawatt-hours in two weeks, according to Markedskraft AS data on Bloomberg. The region, which gets more than half of its power supplies by running water through turbines, had a surplus of 9 terawatt-hours as recently as the end of November.
The utilization rate of Swedish and Finnish nuclear reactors rose to a five-week high of 96 percent as of 7:45 a.m. Stockholm time, after EON SE (EOAN) started its 638-megawatt Oskarshamn-2 reactor yesterday following a five-week halt, according to data from the operator and calculations by Bloomberg. The region gets a fifth of power output from atomic reactors.
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