EUROPE POWER- German Power Futures Prices Rise Following Russian Sanctions

PARIS, February 28 (Reuters)German futures curve power contracts jumped along with fuels following sanctions imposed over the weekend by European countries on Russia in response to its invasion of Ukraine. NG/EUWHERE

“Sanctions and the exodus of Western oil companies are likely in the medium to long term to lead to a decline in Russian oil and gas production,” Commerzbank analysts said in a research note.

This will make investments in maintaining production and developing new sources much more difficult, they added.

German base power for delivery in 2023 TRDEBYZ3 gained 2.4% to 149.50 euros ($167.28) per megawatt hour (MWh) at 10:30 GMT.

First-quarter contracts and March baseload rose in Germany on Monday. 0#TRDEB:

Equivalent French base power for delivery in 2023 TRFRBYZ3 down 5.7% to 174 euros.

European CO2 quotas due December 2022 CFI2Zc2fell 7.2% to 81.77 euros per tonne.

The European Commission will ask member states on Monday to activate an emergency synchronization procedure for the bloc’s electricity grid with that of Ukraine, Energy Commissioner Kadri Simson said.

BP is shedding its stake in Russian oil giant Rosneft in an abrupt and costly end to three decades of operating in the energy-rich country, while Exxon faces pressure over its relationship with the company.

A gas pipeline from Poland to Lithuania will open ahead of schedule, Germany’s E.ON has announced EONGn.DE rejected requests for Nord Stream 1 to stop and eastward deliveries resumed on the Yamal-Europe pipeline.

Europe has few alternatives to replace Russian supplies in the short term, as LNG regasification terminals are already in use at near capacity and domestic production is at maximum, Rystad Energy said in a research note.

The power system has the potential to add around 152 terawatt-hours (TWh) of additional supply in 2022, with 63 TWh of potential coming from coal-fired power plants if they are used to their maximum, although installed capacity is expected to drop. they added.

Normalized wind speeds could add up to 22 TWh of new supply, while new solar supply has the potential to add 11 TWh and liquids and bioenergy plants could add 77 TWh, nuclear and hydro have limited production potential, said Rystand Energy.

In the spot market, electricity prices rose on Monday as wind supply is expected to fall across the region.

The wind supply forecast for west-central Europe is expected to remain below normal on Tuesday, Refinitiv analysts said.

Basic next day delivery within Germany TRDEBD1 was at 248.50 euros, up 10.4% from Monday.

The equivalent French price TRFRBD1 gained 10.8% to 277 euros.

German wind power is expected to fall by 4.4 gigawatts (GW) to 10.3 GW on Tuesday, according to data from Refinitiv Eikon.

Nuclear availability in France fell 2.1 percentage points to 71.9% of installed capacity on Monday, as the Golfech 1 reactor was taken out of service for its planned 10-year maintenance. POWER/FR

Daily electricity demand in Germany is expected to increase by 5.1 GW to 62.6 GW on Tuesday, while consumption in France is expected to increase by 450 megawatts (MW) to 65.3 GW, according to data from Refinitiv Eikon.

($1 = 0.8937 euros)

(Reporting by Forrest Crellin; Editing by Shinjini Ganguli)

((forrest.crellin@thomsonreuters.com, +33 7 69 52 66 73))

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James R. Rhodes