In this month's Market Watch, our experts Chitransh Lot and Reinhard Kaisinger assess key developments and trends in the electricity market. Focusing on the single day-ahead market coupling (SDAC),they provide insights into the pricing dynamics, net positions, and noteworthy shifts in various regions.
Market Integration across Europe
The price convergence in radial grids using the cNTC methodology remains good, with the price difference being less than €10/MWh/h about 50% of the time. However, price convergence in the Core region dropped by approximately 10% compared to the previous month. Increased generation from renewables and a lack of storage contribute to high market volatility, impacting overall convergence across Europe.
Market Volatility in Finland
Finland has encountered significant price fluctuations, with high occurrences of negative prices (96 MTUs during May 2024) and peak day-ahead prices (20 MTUs with prices > €200/MWh/h). This volatility is anticipated to persist for the coming months due to the interconnector outage between Estonia and Finland and increased renewable generation.
Impact of Solar generation
May showed a significant correlation between load and prices, with low median prices observed during peak solar generation hours. The lowest prices occurred on Sundays due to a mix of low demand and high solar generation. The highest prices were observed after 6 pm, indicating the need for flexibility in the system
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Industry Topics
Market Integration, SDAC, IntraDay