A series of revisions to nuclear power outages in Belgium announced Monday lifted fourth-quarter 2018 power prices across Europe.
Belgian nuclear operator Electrabel revised the outage schedule at three nuclear reactors to add more than seven months of downtime, with traders expressing concerns that delays could potentially stretch longer than announced.
The Belgian Q3 baseload power price surged more than Eur4 compared with Friday's settlement to reach Eur53.63/MWh on Monday, Intercontinental Exchange data showed.
The Q4 contract nearly added Eur3 to close at Eur62.10/MWh, narrowing its spread to its French counterpart, which traded at Eur62.15/MWh on EEX Monday.
In France, Q4 baseload surged Eur1.50/MWh on Monday to Eur62/MWh.
"Belgium is most affected by the news, then France, as it is the most coupled and linked," a trader said.
"France is the easier to trade as Belgium is quite illiquid. Prices during the tight [winter] period could go much higher. I think there is still a lot of upside," he added.
In the UK, the Winter 2018 baseload contract traded at GBP60.30/MWh in the over-the-counter market around midday, up GBP1/MWh from S&P Global Platts' assessment on Friday.
A UK-based trader said: "We have three crucial Belgian plants affected, and this is now already scheduled to take until end of the year, and this issue is concrete. Then it could move well into [the first quarter of] 2019."
Another trader agreed: "If the outages are extended, Q1 stands also at higher risk. Also winter temperatures will be decisive about the impact. A lot of different factors to consider, but the potential of even higher prices is there."
The restart of Electrabel's 1-GW Tihange-3 reactor, which has been offline since the end of March, was delayed on Monday by three months to September 30 to inspect an issue with concrete ceilings at the plant.
The 1-GW Tihange-2 reactor will come off the grid on August 19 and stay off until October 31, five weeks longer than previously expected, while the 1-GW Doel-4 unit will now come offline three months earlier than planned on August 6, staying offline until December 12.
The changes follow discussions with the Belgian nuclear safety regulator AFCN.
Other European markets reacted sharply as well, with Q4 baseload power in Germany rising 90 euro cent to Eur49.55/MWh.
A German trader said the outages definitely contributed to the bullishness for long-term contracts, but could not say if it was the main driver as commodities were firmer Monday morning and EU emissions allowances also rose.
Dutch Q4 baseload was bid and offered at Eur54.80/MWh and Eur55.40/MWh, respectively. Q4 settled at Eur53.40/MWh in the Netherlands on Friday. However, it was bid and offered at Eur62.45/MWh and Eur63/MWh in the OTC market, according to a trader.
Asked if the market anticipates a risk that other reactors might be affected by the structural repair needs, another trader said the "big question is what can you believe and what" you cannot, illustrating the element of uncertainty given the nature of repairs.
