The forward market has recovered around 60% of losses following last week’s market crash. UK Baseload Winter 21 power prices rebounded from as low as £104/MW to £114.85/MW, whilst NBP prices have seen an increase from 104p/therm to 120.64p/therm. This was a correction, as the market dropped significantly due to rumors of the North Stream 2 pipeline starting flows caused by a data error incorrectly showing gas flowing through the pipeline. This recovery has been fuelled by gas prices increasing, further accentuated by lower than average supply levels across Europe and a lack of scheduled supply to alleviate these pressures. As winter draws closer the chance of a late resurgence of supply levels becomes even slimmer. What the last two weeks have shown us is that the market and its stakeholders seem to be poised for the commissioning of Nord Stream 2 which is scheduled to be completed in just 2 weeks. There has been a slight setback in regards to this, with Gazprom losing a court case to be exempt from EU fair competition laws. The law requires the owners of pipelines to be different from the suppliers of the gas that flows in them to ensure fair competition. This will not halt the Nord Stream 2 but will cost it extra time and money.
National Grid is set to partner with green product innovators Open Climate Fix to build a machine learning tracking system capable of matching cloud movements to precise locations in order to better predict solar generation. Solar generation is often difficult for National Grid to predict because it is a form of embedded generation. This means that solar generation acts as a demand offset and is difficult to forecast because the grid does not have sight of this generation. Forecasts are critical in balancing the grid especially with an increasing amount of intermittent generation. Carolina Torta, National Grid ESO’s head of innovation strategy and digital transformation, explained “If you’re more confident in your forecast, then you don’t need to have as big of a buffer”. With the UK Energy industry undergoing a renewable revolution, forecasting will continue to grow in importance.
The NSL access rules were approved on Monday, which is scheduled to commence operations on 1 October, gradually increasing capacity. The NSL will go live with an implicit solution, with capacity allocated by connecting together the Nord Pool day-ahead auction in GB and a new day-ahead auction from Nord Pool for the NO2 bidding zone in Norway. The day-ahead auctions will close at 09:50 UK time and results are expected to be published some 10-15 minutes later.