The premiums associated with buying November power contracts in Belgium compared to those in neighboring France or the Netherlands have slipped close to Eur2.50/MWh and Eur3/MWh since the start of the month, respectively, as fears around Belgian winter supply eased following spiking spot prices during mid-October, an analysis of Platts pricing data shows.
On Friday, Platts assessed the Belgian month-ahead baseload power contract at Eur47.70/MWh, down nearly Eur4 since the start of the month, while the equivalent French contract has shed just 35 euro cent over the same period.
Contracts on the Dutch near-curve have also showed stability, adding just 15 euro cent during October to date to close at Eur38.10/MWh Friday, Platts pricing data showed.
The premium for Belgian November power is now less than Eur6/MWh and Eur10/MWh compared to France and the Netherlands, respectively.
The average premium over France during October to date is Eur8.01/MWh, while the average additional expense over the Netherlands is Eur11.41/MWh.
Weakness on the Belgian month-ahead comes in the wake of spiking prices on the prompt, when a combination of below-average temperatures, unavailability across large tranches of the Belgian nuclear fleet and reduced import availability from France pushed the Belpex exchange to more than Eur200/MWh on October 15, the highest price since late 2007.
Market sources attributed the high volatlilty to the delayed return of Electrabel's 1 GW Doel-4 nuclear reactor, which returned to generation on October 17, two days later than planned.
With Doel-4 back online, available nuclear capacity in Belgium is close to 60%, Electrabel data shows, with the Tihange and Doel power plants accounting for more than half of domestic generation capacity.
Uncertainty on the near term overflowed into the curve, adding close to Eur1/MWh to the Belgian November baseload contract in a single day -- the equivalent of an extra Eur720/MWh over the month -- with market sources expressing unease about the ability of Belgium to satisfy power demand over the impending winter.
Sliding Belgian premiums during October come in stark contrast to those seen one year ago, when November baseload power averaged Eur10.57/MWh more than the French equivalent, and Eur14.31/MWh more than power sourced on the Dutch OTC market, Platts pricing data showed.
