European Power for 2014 Advances for First Month Since August

Power for 2014 delivery in Germany and France, Europe’s biggest markets, rose for the first month since August as European Union emissions permits advanced.

Baseload German year-ahead electricity, for supplies delivered around the clock, added 1.2 percent, taking its monthly gain to 4.8 percent. The French contract increased 2.3 percent from its close on Jan. 31 while emissions advanced 44 percent this month. Power can track emissions, which affect production costs.

“The link between European Union Allowance price movements and the German power price continues to be strong,” Paolo Coghe, a Paris-based analyst at Societe Generale SA (GLE) said in an e-mailed report. “We continue not to expect any large price changes in the European energy complex for the week to come.”

German next-year power, a benchmark contract in Europe, rose 50 cents to 42.35 euros ($55.40) a megawatt-hour at 5:35 p.m. in Berlin, according to broker data compiled by Bloomberg. French power added percent 0.6 percent today to 44.75 euros.

EU carbon for December gained as much as 13 percent to 5.03 euros a metric ton on the ICE Futures Europe exchange in London.

German power for March rose 1.1 percent to 39.90 euros while the French equivalent advanced 4.3 percent to 48.60 euros, broker data show.

Solar power generation in Germany is expected to have a “strong, additional and depressive impact” on next month German power prices as spring starts and days get longer, Coghe said.

Temperatures in France will average 3.1 degrees Celsius (37 Fahrenheit) through March 3 compared with a previous forecast for 3.2 degrees, according to a GFS model supplied by MetraWeather to Bloomberg at 5:39 p.m. Berlin time. In Germany, average temperatures will be minus 0.3 degrees, compared with a previous prediction for minus 0.2 degrees.

To contact the reporter on this story: Rachel Morison in London at rmorison@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net

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