BAKU, Azerbaijan, Aug.10. The crisis facing Norway and Europe reveals the greatest challenge for renewable power in the context of an energy security crisis– upgrading transmission lines and grids so that power can be shifted around as easily as gas through pipelines, Trend reports referring to the comments from Senior Analyst at Rystad Energy Fabian Rønningen.
“A driver for lower prices on the continent is the reduction in gas spot prices seen over the last two weeks. The TTF spot is currently trading at €190 per MWh, a reduction of 9.3 percent since the peak on 27. July. LNG imports to Europe stayed high in July as well, with a slight increase compared to June, driven by a large increase in French imports. Total European gas storage stood at 72.2 percent on Sunday, compared to 59.2 percent at the same time last year. The injection rate has also been stable and high in the last two weeks,’ he said.
Rønningen pointed out that a large gap still exists between the European gas price hubs, with Iberian and British prices at a large discount to the TTF in the Netherlands.
“The gap has been reduced slightly over the last two weeks with declining TTF prices and fairly stable prices in UK and Spain. There has been less of a reduction in TTF front-month contracts, and the front-year has just continued its increase, currently trading at €165.5 per MWh, a new high for the year. This has impacted the long-term power constraints as well, which have continued to rise,” he added.
The analyst pointed out that despite the current gas supply crisis in Europe, gas ended up as the largest overall power supply source in Europe in July, which shows how few alternatives European countries have for power supply.
“This was the first time in two years that nuclear was not the largest overall source of power supply in Europe, for a whole month. Reasons for this include the current very low nuclear availability in Europe, poor hydropower generation caused by heatwaves and droughts, low wind power generation as normal in the summer months, and limited possibility for most countries for large-scale gas-to-coal switching since so much capacity has been decommissioned in recent years,” Rønningen explained.
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