RUS | ENG | All
Enter the email or login, that you used for registration.
If you do not remember your password, simply leave this field blank and you will receive a new, along with a link to activate.

Not registered yet?
Welcome!

2022-10-03 12:10:00

EUROPE LIMITS ENERGY

EUROPE LIMITS ENERGY

PLATTS - 30 Sep 2022 - EU energy ministers reached political agreement Sept. 30 on measures to mitigate high electricity prices, including a mandatory 5% cut in peak hour power demand and a Eur180/MWh revenue cap on inframarginal generators, the Czech Presidency of the EU Council said following an emergency meeting in Brussels.

The measures were described as "temporary and extraordinary in nature", with demand reduction targets applying to March 31, 2023, and the cap on market revenues to June 30, 2023.

"Member states will flatten the curve of electricity demand during peak hours, which will have a direct positive effect on prices. Member states will redistribute surplus profits from the energy sector to those who are struggling to pay their bills," said Czech Industry and Trade Minister Jozef Sikela.

On electricity demand, member states must identify peak hours corresponding to a minimum 10% of all hours between Dec. 1, 2022 and March 31, 2023, the agreed Council Regulation text said.

"Each Member State shall reduce its gross electricity consumption during the identified peak hours. The reduction achieved over the identified peak hours shall reach at least 5% on average per hour," it said.

In general member states should strive to reduce total monthly gross electricity consumption by 10% versus average gross electricity consumption, it said.

Flexibility on cap application

On the mandatory Eur180/MWh cap on inframarginal generator market revenues, member states can decide whether to apply the cap on market revenues at the settlement of the exchange of energy or thereafter, the text said.

Inframarginal generators were defined by Sikela as mainly renewables, nuclear and lignite producers.

The cap must cover all market revenues of producers and intermediaries participating in electricity wholesale markets, "regardless of the market timeframe in which the transaction takes place and of whether the electricity is traded bilaterally or in a centralized marketplace," the text said.

At the same time, member states can maintain or introduce measures that further limit market revenues of inframarginal generators, as well as differentiate between technologies, or target market revenues of other participants including traders, it said.

National governments can also choose to set a specific cap on hard coal generator revenues, it said.

"Member States shall ensure that all surplus revenues resulting from the application of the cap on market revenues are employed to finance measures in support of final electricity customers that mitigate the impact of high electricity prices on those customers," it said.

European power and gas prices have been on a bearish run since the proposals were first announced by the EC on Sept. 14.

Platts, part of S&P Global Commodity Insights, assessed the front-month TTF gas contract at Eur184.50/MWh Sept. 29, down 9.31% on the day, and down 18% since Sept. 14.

Platts assessed German onshore wind capture prices at Eur215.09/MWh Sept. 28. On Aug. 26 the assessment peaked at Eur570.47/MWh.

Serious concerns

Ahead of the agreement, sector associations WindEurope and Europex expressed serious concerns at the discretion allowed member states in applying further measures to cap market revenues.

"An EU-wide cap on revenues from wind should be precisely that -- a single EU-wide cap. Allowing countries to deviate from it and have lower caps creates confusion and certainty -- and will slow down the investments we so badly need", said WindEurope CEO Giles Dickson Sept. 14.

Energy exchange association Europex, meanwhile, was concerned at the flexibility allowed on when to apply the cap.

Applying the revenue cap at or shortly after trade execution would result in a de facto price cap, "dangerously affecting" bidding behavior in the market, it said Sept. 28.

"We strongly urge that the revenue be captured solely ex-post by all member states, after the settlement and after the market price has been cleared," it said.

-----


Earlier:

EUROPE LIMITS ENERGY
2022, September, 30, 09:45:00
EUROPEAN ENERGY CRISIS: DEEPER
The 27-nation bloc has already agreed on a voluntary target to cut gas consumption by 15% after Russia, its biggest supplier, cut shipments following the invasion of Ukraine. Still, more action is needed to contain the energy crunch that’s fueling inflation and risks recession.
EUROPE LIMITS ENERGY
2022, September, 29, 13:55:00
EUROPEAN GAS PRICES DOWN AGAIN
Benchmark prices declined as much as 6.4%, after rising 19% over the previous two days.
EUROPE LIMITS ENERGY
2022, September, 28, 12:35:00
EUROPEAN GAS PRICES UP AGAIN
Dutch front-month gas, the European benchmark, rose 11% to 206 euros per megawatt-hour at 8:47 a.m. in Amsterdam. Price increased 7.1% on Tuesday.
EUROPE LIMITS ENERGY
2022, September, 22, 16:30:00
EUROPEAN ENERGY CRISIS PLAN
The European Commission aims to publish Sept. 28 a document detailing future steps to ease volatility and increase trading volume in energy markets after surging prices led to ballooning margin calls
EUROPE LIMITS ENERGY
2022, September, 19, 12:55:00
EUROPE: FREEZE TO SAVE
With European energy prices at acute levels, there are huge risks that could destabilise the whole social, economic, and political fabric of Europe.
EUROPE LIMITS ENERGY
2022, September, 15, 16:25:00
EUROPEAN ENERGY CRISIS €140 BLN
The plan is expected to raise €140bn, including €117bn from the temporary revenue cap on inframarginal electricity producers and €25bn from the temporary solidarity contribution based on taxable surplus profits made in the fiscal year 2022 on energy undertakings in the oil, gas, coal and refinery sectors
EUROPE LIMITS ENERGY
2022, September, 14, 13:05:00
EUROPEAN ELECTRICITY PRICES RECORDS
So far, in 2022, spot electricity prices are five to ten times higher than in previous years. On August 22, the daily spot market price for Germany exceeded 600 EUR/MWh, 15 times the average of the 2010s.
All Publications »
Tags: EUROPE, ENERGY, ELECTRICITY
Chronicle:
EUROPE LIMITS ENERGY
2023, February, 3, 11:29:00
9TH INTERNATIONAL LNG CONGRESS LNGCON 2023
9th International LNG Congress (LNGCON 2023) 6-7 March, 2023 Link to the Congress website: https://bit.ly/3tXVmr7
EUROPE LIMITS ENERGY
2023, February, 3, 11:28:00
TRANSPORTATION OIL AND GAS CONGRESS 2023 (TOGC 2023)
Transportation Oil and Gas Congress 2023 (TOGC 2023) takes place on February 20-21, 2023. The Congress brings together representatives from the whole pipeline chain and focuses on both strategic and technical issues of the oil and gas pipeline transportation.
EUROPE LIMITS ENERGY
2023, February, 3, 11:25:00
ЦЕНА URALS: $49.48
Средняя цена на нефть марки Urals в январе 2023 года сложилась в размере $49,48 за баррель, что в 1,7 раз ниже, чем в январе 2022 года ($85,64 за баррель).
EUROPE LIMITS ENERGY
2023, February, 3, 11:20:00
RUSSIAN GAS TO EUROPE DOWN AGAIN
Total Russian pipeline exports to Europe in January via the two remaining major supply routes were 36% down on deliveries in December and 79% lower year on year.
EUROPE LIMITS ENERGY
2023, February, 3, 11:15:00
BP: THE TRANSITION TO A LOW-CARBON WORLD
The transition to a low-carbon world requires a range of other energy sources and technologies, including low-carbon hydrogen, modern bioenergy, and carbon capture, use and storage.
EUROPE LIMITS ENERGY
2023, February, 3, 11:10:00
GERMAN WIND ENERGY 7 GW
Germany targets 30 GW of offshore wind by 2030. The country had 7.7 GW of offshore wind installed capacity at the end of 2021.
EUROPE LIMITS ENERGY
2023, February, 3, 11:05:00
INDIA GREEN TRANSITION $8 BLN
India plans to spend US$4.3bn on energy transition through the Ministry of Petroleum and Gas, including programs for green fuel, green energy, green farming, green mobility, green buildings, and green equipment and policies for efficient use of energy across various economic sectors.
All Publications »