UK day-ahead power contracts rose more than 9% Tuesday as the planned shutdown of two nuclear reactors combined with weakened wind power generation is likely to tighten supply margins.
Baseload power for Wednesday delivery was assessed at GBP35.50/MWh before Platts 11:00 am London time close, up GBP3.10 from where Tuesday's price closed on Monday, while the peakload contract was assessed at GBP37.50/MWh, up GBP3.35 on the day.
The day-ahead auction meanwhile settled day-ahead base below OTC levels at GBP35.00/MWh with peakload also clearing below OTC at GBP37.46/MWh, according to N2EX and APX exchanges Tuesday.
EDF Energy shut down two nuclear power units overnight to Tuesday which reduced nuclear capacity by nearly 1 GW. EDF's Heysham-1 reactor will be offline for refueling and boiler modifications but is expected to return this week, while the Sizewell B unit 1 will remain offline until June for refueling and maintenance, according to the plant operator.
A drop in wind output is likely to add further pressure on supply margins on Wednesday with wind generation forecast to remain below 1.5 GW Wednesday after declining from Tuesday's of 3.8 GW, National Grid data showed. Solar power output is set to remain steady at 1.6 GW.
While the downturn in available power capacity is likely to tighten supply margins, mild weather continues to dampen power demand this week.
According to system operator National Grid, peak power demand was forecast to dip slightly lower on the day to hover above 39 GW Wednesday evening after nearing 40 GW on Tuesday.
Temperatures across the country are forecast to hover at around the seasonal norm this week amid unsettled weather, with the UK's Met Office expecting "cloudy and damp conditions to affect many northern areas, while showers move into the southwest." However, warmer conditions are expected in the southern regions in the second half of the week, data showed.
At midday Tuesday, production from gas-fired power plants rose sharply to 19.3 GW, or 52% of the UK's total energy supply, with nuclear power stations generating 7.4 GW (20.1%) following the shutdown of two units.
Production from coal-fired power plants remained sluggish at 2 GW (5.6%), while wind power output had halved from the previous day to 2.5 GW (6.8%), National Grid data showed.
