GB Wholesale Market Summary March 2021
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GB Wholesale Market Summary March 2021 Published April 2021 1. A combination of higher carbon prices and demand caused the monthly average power price in E x e c u t i v e March 2021 to rise to £54.1/MWh, a £1.2/MWh (2.3%) increase from February 2021. This represents a year-on-year increase of £25.63/MWh (89.9%) due to a subsequent economic recovery from the initial crash caused by COVID-19. See slides 5, 6, and 7. S u m m a r y 2. Power prices in March saw high levels of volatility with several negative periods and prices exceeding £280/MWh. This was primarily driven by weather intermittency coupled with higher demand. See slides 5 and 8. 3. Driven by increased economic activity from relaxation of the national lockdown, the monthly transmission power demand in March increased by 0.8 TWh (3.6%) relative to February, while the share of low carbon generation fell by 7 p.p. to 56.2% of total generation. See slides 10 and 11. 4. Monthly thermal generation in March increased by 1.5 TWh (19.2%) relative to February as demand increased, and renewables output decreased. Consequently, carbon emissions increased by 0.5 MtCO2e (13.3%) compared to February. See slides 11 and 14. 5. The profitability of wind assets in March saw a decrease relative to February, caused by an 11 p.p. decrease in wind load factors to a monthly average of 40.5%. This was accompanied by a decrease in wind capture prices (£1.2/MWh or 2.4% relative to February). See slides 20 and 22. 2 Aurora offers power market forecasts and market intelligence spanning Europe’s key markets, Australia and the US Comprehensive Power Power Market Bespoke Market Services Forecast Reports forecasts Market forecast Power market Aurora can provide ✓ reports ✓ forecast reports ✓ power market forecasts upon Forecast data in Forecast data in request ✓ Excel ✓ Excel Global energy ✓ Analyst support ✓ market forecast reports Strategic insight ✓ reports Regular subscriber ✓ group meetings ✓ Policy updates ✓ Bilateral workshops ✓ Analyst support Source: Aurora Energy Research 3 Agenda I. System performance II. Company performance (available to subscribers only) III. Plant performance 4 1 System performance Half-hourly EPEX spot price for March 1 EPEX spot price Monthly average price in March 2021: £/MWh £54.14/MWh 300 270 240 210 180 150 120 90 60 30 0 -30 01-Mar 08-Mar 15-Mar 22-Mar 29-Mar 1) Half-hourly EPEX is the volume-weighted reference price over that half-hour interval, as provided by EPEX Spot Sources: Aurora Energy Research, Thomson Reuters 5 1 System performance Historic monthly average EPEX spot price Average EPEX spot price1, £/MWh 75 70 65 60 +2.3% 55 50 45 40 +89.9% 35 30 25 20 Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- 10 11 12 13 14 15 16 17 18 19 20 21 Average monthly spot price Annual average spot price x Month-on-month difference x Year-on-year difference 1) Average monthly EPEX is the average over the month of the volume-weighted reference prices for each half-hour interval. Sources: Aurora Energy Research, Thomson Reuters 6 1 System performance Historic fuel prices Gas, Coal and Carbon daily prices Gas/Coal price Total carbon price1 £/MWh £/tCO2 30 60 25 50 20 40 15 30 10 20 5 10 0 0 Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov Dec- Jan- Feb- Mar- 20 20 20 20 20 20 20 20 20 20 21 21 21 Gas Coal Carbon 1) Includes EU-ETS and CPS. The UK left the EU-ETS scheme in 2021 to a national UK-ETS scheme Sources: Aurora Energy Research, Thomson Reuters 7 1 System performance Half-hourly spot prices against half-hourly system margins for March EPEX spot price1, £/MWh 300 280 260 240 220 200 180 160 140 120 100 80 60 40 20 0 -20 5,000 10,000 15,000 20,000 25,000 30,000 35,000 Margins2, MW 1) Half-hourly EPEX is the volume-weighted reference price over that half-hour interval, as provided by EPEX Spot. 2) Margins are calculated as the difference between MEL and Demand for each half-hour period. Demand data presented here is Initial Transmission System Demand Out-Turn, and does not include embedded demand. MEL is calculated as the sum of all transmission BM units reporting MEL values in each half-hour. Where a BMU gives multiple values in a half-hour, only the least is taken. Sources: Elexon, National Grid, Thomson Reuters, Aurora Energy Research 8 1 System performance Daily March max and min demand Relative to historic March max and min demand since 20101 Demand2, GW 55 50 45 40 35 30 25 20 15 10 5 0 M Tu W Th F Sa Su M Tu W Th F Sa Su M Tu W Th F Sa Su M Tu W Th F Sa Su M Tu W Daily range Historic maximum/minimum 1) Data from previous years is matched to the nearest weekday within the current month, to maintain the weekly demand pattern. 2) Demand data presented here is Initial Transmission System Demand Out-Turn, and does not include embedded demand. Sources: National Grid, Aurora Energy Research 9 1 System performance Monthly historical demand on the transmission system Total demand1, TWh 34 32 30 28 26 24 +3.6% 22 +0.4% 20 18 16 Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- 10 11 12 13 14 15 16 17 18 19 20 21 Total monthly demand Annual average demand x Month-on-month difference x Year-on-year difference 1) Demand data presented here is Initial Transmission System Demand Out-Turn, and includes station transformer load, pumped storage demand and interconnector demand, but does not include embedded demand. Sources: National Grid, Aurora Energy Research 10 1 System performance Monthly fuel mix breakdown Output1 TWh 22 0.9 0.3 21.0 1.8 1% 20 4% 1.8 8% 18 2.3 8% 16 3.3 11% 14 12 16% 3.5 100% 10 16% 8 7.2 6 4 34% 2 0 CCGT Nuclear Offshore Wind Other Onshore Wind2 Other fossil3 Solar Coal Total renewables Load factor, % 36 49 45 59 36 31 9 7 1) Includes outputs from generators registered as BM Units as well as embedded wind and solar PV assets. All numbers are rounded to 0.1 TWh which means that subtotals may not sum to total value. 2) Other fossil includes oil, CHP-CCGT and OCGT. 3) Other renewables includes biomass and hydro. Sources: Elexon, Sheffield Solar, National Grid, Aurora Energy Research 11 1 System performance Historical fuel mix breakdown Output1 % of total 100% 4% 0% 1% 1% 6% 6% 5% 8% 0% 8% 9% 90% 6% 5% 14% 4% 18% 16% 5% 9% 10% 80% 5% 6% 19% 8% 29% 7% 5% 21% 6% 15% 8% 70% 44% 18% 8% 7% 15% 11% 17% 8% 60% 34% 9% 8% 9% 31% 50% 9% 36% 51% 46% 40% 39% 41% 35% 26% 28% 34% 18% 26% 30% 15% 6% 20% 2% 2% 1% 10% 20% 23% 20% 20% 21% 23% 21% 19% 19% 19% 16% 16% 0% Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- Mar- 10 11 12 13 14 15 16 17 18 19 20 21 Nuclear Coal CCGT Other fossil2 Other renewables3 Onshore Wind Offshore Wind Solar 1) Includes outputs from generators registered as BM Units as well as embedded wind and solar PV. 2) Other fossil includes oil, CHP-CCGT and OCGT. 3) Other renewables includes biomass and hydro. Sources: Elexon, Sheffield Solar, National Grid, Aurora Energy Research 12 1 System performance Monthly interconnector flow duration curve Flow in each half-hour for GB interconnectors Flow1, MW 2,500 2,000 1,500 1,000 500 0 -500 -1,000 -1,500 -2,000 Time Half-hours I/C France I/C Netherlands I/C N. Ireland I/C Rep. Ireland I/C Belgium 1) Positive flow is imports into GB, negative flow is exports. Sources: Elexon, National Grid, Aurora Energy Research 13 1 System performance Monthly power sector emissions by technology Emissions1 Carbon intensity MtCO2e gCO2e/kWh 7 280 +18.1% 6 5.8 +13.3% 240 5 4.6 200 4.2 3.9 4 3.8 3.8 3.7 3.7 160 3.6 3.4 3 2.9 120 2.4 2.1 2 80 1 40 0 0 Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- 20 20 20 20 20 20 20 20 20 20 21 21 21 Biomass Other fossil2 CCGT Coal System carbon intensity x Month-on-month emissions difference x Year-on-year carbon intensity difference 1) Please refer to Appendix for details of methodology employed to calculate emission amounts. Includes all Balancing Mechanism plants. 2) Other fossil includes oil, OCGT and gas CHP-CCGT. Sources: Elexon, Ofgem, Aurora Energy Research 14 Agenda I. System performance II. Company performance (available to subscribers only) III. Plant performance 15 Agenda I. System performance II. Company performance (available to subscribers only) III. Plant performance 16 3 Plant Performance Plant utilisation – load factors by plant Load factor1 Column width % reflects capacity 100 90 80 70 60 50 40 Ø 36 30 20 10 0 -10 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 Capacity, GW Biomass Coal Hydro Nuclear Offshore Wind Onshore Wind Solar CCGT Gas CHP-CCGT Interconnector OCGT Oil Pumped Storage 1) Represents 60 plants with highest capacity according to the Balancing Mechanism (BM) database, as well as aggregated data for wind and solar.