By Tsvetana Paraskova of OilPrice.com
Intraday power prices in Germany jumped and natural gas-fired electricity generation rose to a two-year high this week as low wind speeds continue to depress wind power output.
Natural gas use for power generation rose on Wednesday to its highest level since December 2022, as a wider power supply gap had to be filled by fossil fuels amid very weak wind power generation.
Intraday power prices have jumped for the peak Wednesday hours, according to EEX data cited by Bloomberg.
Germany’s power margin, the available electricity supply to meet demand, has dropped this week to the lowest level so far this winter, as low wind speeds and colder weather are straining the power system.
This week, wind speeds in Germany have dipped again, while colder-than-usual temperatures have settled over much of northwest Europe.
Since early November, the so-called ‘Dunkelflaute’, German for “dark wind lull”, have often resulted in wind farms in Europe’s biggest economy generating only a fraction of their nameplate capacity, leading to day-ahead electricity prices for peak demand hours to high levels not seen since the peak energy crisis in 2022.
Near-term power prices have increased as supply has been fluctuating while demand has been growing with the colder temperatures. Germany has had to import more electricity from France and rely more on fossil fuels for power generation during periods of low wind speeds.
The wind speeds will only pick up this coming weekend, according to Bloomberg modeling.
This means that Germany has to grapple with higher hourly power prices and increased gas demand until at least Friday.
Gas-fired power generation in Germany jumped in November from October by the largest-ever monthly increase, according to data from energy think tank Ember cited by Reuters last week.
That was mostly because of the 25% lower wind power generation in October and November compared to the same two months of last year.
