European 2014 Power Rises for Second Day as Carbon AdvancesRachel Morison
Power contracts for 2014 delivery in Germany and France climbed for a second day as European Union emissions allowances gained.
Baseload German 2014 electricity, for supplies delivered around the clock, rose 1.4 percent while French power gained 1.8 percent and carbon permits increased 5.5 percent. Power can track emissions, which affect production costs.
German power, a benchmark contract in Europe, climbed as much as 65 cents to 42.10 euros ($57.07), the highest price since Jan. 23, according to broker data compiled by Bloomberg. The contract traded at 42.05 euros as of 4:42 p.m. Berlin time. French power advanced 80 cents to 45.30 euros, broker data show.
EU carbon permits for December rose as much as 27 cents, or 6.2 percent, to 4.61 euros a ton on the ICE Futures Europe exchange in London. The increase will be “short-lived” and carbon prices will continue to deteriorate, Per Lekander, a Paris-based analyst at UBS AG, said today in an e-mailed research note.
Next-week power in France and Germany gained amid forecasts of lower-than-average temperatures. Week-ahead power in Germany rose 15 percent to 46.50 euros while the French contract climbed 16 percent to 56.25 euros, broker data show.
Temperatures in Frankfurt are forecast to fall to minus 5 degrees Celsius (23 Fahrenheit) on Feb. 10 versus a 10-year seasonal average of 0 degrees, according to CustomWeather Inc. data on Bloomberg. In Paris, minimum temperatures will decline to minus 3.6 degrees on Feb. 9 compared with a 10-year average of 4 degrees.
Electricite de France SA is scheduled to halt its 880-megawatt Bugey-5 and 1,300-megawatt Cattenom-4 reactors on Feb. 9 for maintenance, French grid operator RTE says on its website.
The German next-month clean-spark spread, a measure of the profit utilities get from selling electricity after accounting for the cost of gas and emissions permits, fell as much as 9.6 percent to minus 16.26 euros a megawatt-hour, according to data compiled by Bloomberg. March became the front month for power and coal contracts on Feb. 1.