OSLO: Nordic spot power prices fell more than expected after stormy weather knocked out of operation a cable between southern Norway and the Netherlands, reducing the capacity to export electricity to more expensive markets.
Baseload power for delivery on Tuesday was set at 34.50 euros ($47.56) per megawatt-hour (MWh) on the Nord Pool Spot exchange, compared with 34.76 euros for Monday.
The day-ahead contract in the financial market was last traded at 36.40 euros a MWh, indicating that traders expected the spot price to be set much higher.
"Reduction in hydro power prices due to transmission limitations offset a bullish impact from an expected increase in consumption and lower wind power output on Wednesday," Ole Tom Djupskaas, an analyst at Thomson Reuters Point Carbon, said.
Nordic power exchange said a 700 megawatt cable between southern Norway and the Netherlands was out of operation due to damages caused by the storm on the Dutch side on Monday.
Norway's grid operator Statnett said the duration of the outage was unknown.
Combined wind power output in the Nordics was seen falling by 760 MW on Wednesday from Tuesday, while consumption was seen gaining by 790 MW due to colder weather.
Lower than expected spot power prices helped to push Nordic forward power prices lower, which were already under pressure from continued wet weather.
Nordic prices for delivery in the first quarter fell by 45 cents to 39.85 euros a MWh from the previous session, the lowest level in two months.
The contract has shed more than 10 percent since it peaked to 44.6 euros a MWh on Oct. 9.
"Atlantic low pressure activity will remain strong until the end of the next week and will continue to bring unsettled and wet weather," said Georg Muller, a meteorologist at Point Carbon.
The Nordic market gets about half its electricity from hydropower plants, and wet weather tends to push prices lower.
Further out on the curve, front-year eased by 40 cents to 35.85 euros a MWh, despite stronger carbon and coal prices.
The European benchmark carbon contract traded 15 cents up to 4.98 euros a tonne, while coal API2 year-ahead futures were up by 30 cents to $83.40 a tonne.
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