French power demand, prices rise on cold spell

London — French power demand and prices were set to rise over the coming days on colder weather but the electricity system had sufficient capacity to cope, transmission system operator RTE said late Feb. 8.

Demand was forecast to peak at 86.4 GW on Feb. 11, below this winter's peak at 88.2 GW on Jan. 11, RTE said.

Available generation capacity of 88 GW to 90 GW as well as 11 GW of import capacity were seen as sufficient for security of supply in France, it said.

RTE's latest seven-day outlook shows temperatures falling some 5 C below seasonal norms over coming days.

On Feb. 5, the forecast showed a less severe cold snap capping demand at 80 GW for those days.

Week-ahead prices eased Feb. 9 after jumping almost 20% to a Eur65/MWh settle on EEX Feb. 8 with temperatures forecast to rise back towards seasonal norms.

Focus was on spot markets after an IT problem caused EDF to sell 2.5 GW in error into the Epex Spot market, it said Feb. 8 after market close.

"Following an IT problem, EDF as the balance responsible operator for the compulsory purchase sold around 2,500 MW above the forecast onto the Epex Spot market for the delivery dates Feb. 6 to Feb. 9. As a result, actions will be initiated to rebalance in intraday for the remainder of Feb. 8 and Feb. 9," a brief REMIT note said.

Intraday prices on Epex Spot spiked overnight up to Eur199/MWh.

Meanwhile, French nuclear output at 48 GW on Feb. 9 was 4 GW below January's peak with six reactors already offline for 2021 maintenance.

Two units are scheduled to return overnight into Feb. 11, while Cattenom 3 was scheduled to come offline for a 10-year overhaul on Feb. 13.

S&P Global Platts Analytics assumes February nuclear output averaging around 45.5 GW, a new record low for that month, before recovering above last year's monthly averages.

However, downside risks for Q4 2021 have increased after a revision end-January, Platts Analytics' Giuliano Bordignon said.

"Higher prices in 2022 seem however driven by carbon [allowance prices] more than revised nuclear availability, which was indeed changed only marginally," the analyst said.

French year-ahead power traded at Eur55/MWh, the highest in 19 months, EEX data show.

Meanwhile, another 24-hour strike by EDF workers was scheduled to start Feb. 9 at 2000 GMT, EDF said.

Workers are protesting against planned restructuring of the French state-owned utility, splitting nuclear and other operations.

Ongoing discussions with the European Commission about reform of the ARENH price mechanism have delayed those plans.

EDF has to sell 100 TWh of nuclear generation at Eur42/MWh to domestic suppliers. The ARENH reform aims to lift price as well as volumes.