The futures market price for electricity is the current average estimate by traders of the electricity prices of the future. Many factors, which are difficult to estimate in advance, have to be considered by traders: How is the supply of electricity, i.e. the available feed-in capacity of European power plants and their costs such as gas, coal and CO2 prices, developing? How is demand developing in terms of both its level and its structure? Another factor is also becoming increasingly important: the weather.
With this article we continue the series of analysis on sales revenues of wind and PV power generation. On a quarterly basis, we take a look at the theoretically achievable sales revenues of onshore and offshore wind turbines as well as photovoltaic systems and analyse the background. This time, we look at quarter 3.
Most of the regulations of the German Climate Package 2030 gradually went into the parliamentary implementation phase during October 2019. For 2020, the renewable energy levy will rise by about 5 percent. The Federal Network Agency announced the results of the October 2019 tenders for onshore wind and PV. Prices struggle to find a direction amidst uncertain political and economic developments.
The fact that the expansion of wind power in Germany struggles is shown by the results of the tender of August 2019. Meanwhile, e-mobility is making inroads in Germany. A law for supporting the structural change for the coal region is formulated and only needs to be passed. Besides that prices on the futures market in August 2019 were pointing downwards.
With the current “EU Energy Outlook 2050” Energy Brainpool shows long-term trends in Europe. Climate change and aging power plants are forcing the European Union and many countries to change their energy policies. In addition, there are market changes. What do these developments mean for electricity prices, revenue potential and risks for photovoltaics and wind?
The German Federal Court of Justice confirmed lower returns for grid operators, while renewable energies were on record course in the first half of 2019. Associations and politicians discuss the various possibilities for CO2 pricing. There was also a strong upward trend on the prices side in July 2019.
While the tender for PV delivered lower prices in June 2019, there will be delays on the climate policy front. The details of a possible CO2-pricing and a climate-based tax reform are not to be announced until autumn. On the other hand, the second progress report on the energy transition makes it clear that many of the energy transition targets will not be achieved at the current rate of developments. While the spot market turned negative for several hours, the prices at the long end are falling with coal and gas.
The bid values increased in the first tenders in Germany for renewable energies in 2019. In contrast, CO2-limits for new cars and trucks are intended to reduce the emissions of the EU. New German power lines and power-to-gas plants should be easier to set up and plan. On the price side, the trend in April 2019 was mainly upwards. The exception: Easter holidays brought many negative prices.