Irish OTC electricity trade focuses on 2014 products
Trading in the first fortnightly session of the Irish over-the-counter (OTC) electricity market on Wednesday focused almost exclusively on 2014 products, broker Tullett Prebon’s data shows.
The first of the fortnightly all-island Irish OTC market sessions took place in a two-hour window on Wednesday, with the next set to take place on 23 October ( see EDEM 12 September 2013 ). Until now the market has held monthly sessions.
Of the 23 trades, most were for delivery in 2014, with some Q4 ’14 products sold further out on the curve.
One December ’13 Mid-Merit clip – which runs from 07:00-23:00 Ireland time – also dealt.
The total volume of the power sold was 145MW, about half of some of the monthly sessions this year. The September session was cut short because of a technical problem, with only three trades transacted. At the previous session in July, which also doubled up as the August session, traded volume reached 213MW.
January ’14 Baseload traded twice at €73.25/MWh and €73.35/MWh. This gives a volume-weighted average of €73.30/MWh.
On Wednesday, ICIS assessed the UK power equivalent at £56.30/MWh (€66.42/MWh), giving the Irish contract a premium of €6.88/MWh.
The premium of the Irish OTC market to the UK narrowed with the introduction of the carbon price floor in the UK in April.
Before the floor tax the premium was generally in a €8-10/MWh range. However, in May the Irish June ’14 premium was the UK equivalent of €4.74/MWh ( see EDEM 9 May 2013 ).
The premium is linked to capacity payments in Ireland, but is likely to be eroded by 80-90% by 2015, when new EU rules on market coupling are implemented, an Irish power trader previously said ( see EDEM 21 June 2012 ).
The price premium means Irish-based generators struggle to sell power into Britain despite the All Island market having a capacity margin of about 2GW. Since the start of the 500MW East-West interconnector last October linking Ireland to Wales, Ireland has imported far more power than it has exported.
Northern Ireland is linked to Scotland via the 500MW Moyle interconnector, which is operating at half capacity. Fionn O’Raghallaigh
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