While the world looks in surprise at negative prices on the oil markets, these have long been familiar to participants on the electricity market. However, the market results on the electricity exchanges are also anything but normal now: For the first time ever, the price for a baseload delivery falls below zero on a working day.
The results of the tenders for renewable energies were almost predictable. Minimum distances for wind parks and the 52-GW cap for PV remain contentious issues. The figures for the storage sector for 2019 are consistently positive. The effects of the global spread of the new corona virus are particularly noticeable in the energy sector on the price side.
In the second part of this blog series, we elaborate on the links between the coronavirus pandemic and energy markets. Specifically, we examine the possible medium-term consequences for the front years 2021 to 2025 on Europe’s electricity markets due to the coronavirus and the turbulences on the oil market. We conducted the analysis using the fundamental model Power2Sim.
The global spread of the Sars-CoV-2 pathogen has an impact on all global energy markets. With lower demand for energy due to social and economic constraints, commodity prices on the markets have collapsed dramatically.
Coal-fired power generation is sinking, wind is disappointing in tenders for renewable energies and PV is booming, and the National Hydrogen Strategy is making progress – these were the big issues in February.
As the transformation of the energy system to renewable energies, increased sector coupling and electrification progresses, grid infrastructures are also subject to change. The operators of electricity and gas networks must prepare themselves for this.
In order to limit price peaks in the balancing energy price, the Federal Network Agency introduced the mixed-price system in the balancing market. However, this procedure was not free of problems either.
In the second part of our series on the “The German electricity balancing market in transition” we discuss what problems arose during implementation and how the market behaved.