Central-Western-European day-ahead power prices saw a high degree of market coupling in August-to-date, as a slowdown in demand due to low activity in August led to less constraints on interconnections and ironed out the usual differences between the four countries.
Baseload prices were fully coupled for all hours on Tuesday, August 9, at Eur28.77/MWh in France, the Netherlands, Germany and Belgium, Epex Spot data showed.
"Spot deliveries for today were at the same price in France, Germany, Belgium and the Netherlands," a French trader said Tuesday. "This is due to lower[August] demand, as there are lower constraints on interconnections, which increases market coupling."
"I think spot balances switched from tight last week to comfortable this week, mainly on lower temperatures and also some stronger outputs from renewables, as nuclear generation remains low in France," the trader added.
On August 2, baseload prices were also fully coupled at Eur32.55/MWh in the same CWE countries.
Last Friday also saw a high rate of coupling, as the price spread between these countries was zero apart from during a couple of hours when prices differed.
CWE prices for power delivered Wednesday, August 10, were also coupled for most hours, with France and Germany on par for 22 hours out of 24 amid low demand during the holiday season.
The only hours in which France and Germany were not coupled were hours 7 and 8 local time, when the French/German spread was seen at Eur4.50 and Eur1.16 respectively, an analysis of the CASC utility tool showed.
Meanwhile, Belgian and Dutch prices, as well as Dutch and German prices were coupled for all hours Wednesday bar hour 7.
"It's the holiday effect," another trader said.
He said low holiday demand was supporting low prices in France, which managed to couple with their German counterparts on several occasions this August despite a bullish pull given by reduced nuclear availability.
Nuclear availability this week in France is seen at 40.8 GW, down 6 GW year-on-year.
Last week, nuclear availability was down circa 9 GW in the first week of August, with several reactors in planned maintenance and others taken offline unexpectedly.
Peak demand in France was seen mostly unchanged this week in France at around 49 GW, given low industrial activity during the holiday season and also due to low air-conditioning demand amid below-average temperatures.
Temperatures in major German and French cities are expected to fall up to 7 degrees below monthly averages Wednesday and Thursday, CustomWeather data showed.
