Southeast European power markets entered the final part of September with lower electricity demand and sharply reduced gas-fired generation, while exposure to gas supply conditions and import costs remained an important market factor.
Across the markets covered, gas-fired power generation fell 13.60% in the week to 20 September, reducing the immediate volume of gas required by the power sector. At the same time, Norwegian maintenance and LNG availability continued to influence conditions across the wider European gas market.
The impact varied across individual countries. Italy remained the region’s highest-priced electricity market at €215.82/MWh despite lower gas-fired generation. Greece increased its net power exports as both gas generation and electricity demand declined, while Hungary recorded a higher power price even as overall regional consumption weakened.
These developments do not point to a uniform relationship between gas consumption and electricity prices. Renewable generation, hydropower, thermal availability and cross-border capacity also shifted during the week, affecting the balance between domestic generation and imports. Gas-fired plants become more important when these alternative sources cannot cover demand at competitive costs.
The key question for the autumn market will be how quickly gas-fired generation returns as electricity consumption increases. Week 38 brought some relief in terms of gas use in the power sector, but it also demonstrated that lower demand does not necessarily translate into lower electricity prices across Southeast Europe.
By Virtu.Energy
