Who would dare to burn gas this year? despite the record high prices, gas-fired power generation in Europe remained resilient during the heating season, even increasing by a mere 1% yoy.
Several factors contributed to this:
(1) gas-fired generation is less flexible during the winter due to must-run CHP plants;
(2) the steep drop in hydro generation (-20%) occurred in southern European markets (Italy, Spain) with limited remaining coal-fired generation, leading to higher gas burn;
(3) low nuclear output in France during Q1 provided additional market space both to coal- and gas-fired generation;
(4) coal-fired facing logistical constraints is further limiting gas-to-coal switching in certain markets.
In our short-term forecast we foresee a greater demand response over the summer season, leading to a 5% drop in European gas burn for 2022.
What is your view? how will European gas demand and gas-fired power generation react to the record high prices? what are the up and downside risks?
join us tomorrow at 10am CET at our traditional gas webinar!
Source: Greg Molnar (LinkedIn)
European Gas Hub is an online platform for sharing analysis and information about European natural gas markets more info
Sign up to receive our weekly newsletter with new European gas market reports, presentations & analysis. Every Tuesday.
By signing up, I agree to our TOS and Privacy Policy.
© 2020 EuropeanGasHub | All Rights Reserved
