NORDIC POWER-Spot seen up on lower supply from wind, nuclear

Tue Oct 9, 2012 6:13am EDT

Related Topics

* Nordic spot price for Wed seen at 36.4 euros/MWh
    * Oskarshamn-2 reactor to go offline for upgrade

    OSLO, Oct 9 (Reuters) - Nordic spot power prices were
expected to rise as a forecast drop in expected wind and a
temporary halt at a Swedish nuclear power plant shifts the focus
to coal power production, analysts at Point Carbon said on
Tuesday.
    The Nordic average day-ahead power price for
Tuesday delivery was seen firming to 36.4 euros per
megawatt-hour (MWh), compared with 33.5 euros on Monday.
    "With the spot price approaching marginal costs of coal
power production, we will see more output from coal power
plants," a Point Carbon analyst said.
    Point Carbon estimated short-run marginal cost (SRMC) of
coal power production was expected to be 36.7 euros a MWh in
November.
    Combined windpower output in Denmark and Sweden was forecast
to fall from around 3,000 MW on Tuesday to 1,600 MW on
Wednesday, while colder weather was to boost consumption by 850
MW to 44,200 MW.
    Nordic power production would be reduced on Wednesday as
Sweden's 996 MW Forsmark-2 reactor is to go offline to make
technical adjustments needed for upgrading its
capacity. 
                        
    FORWARD PRICES
    The contract for baseload (24 hours) power delivery in the
first quarter rose by 45 cents to 43.25 euros per MWh
by 0900 GMT, compared with Monday's close as weather forecasts
confirmed outlook for drier weather.
    The latest weather forecasts for the next 15 days showed
precipitation levels in Norway and Sweden to be 3,276 MW below
normal levels.
    "The contract rose on the back of the drier weather
forecasts. That's the main factor," an Oslo-based trader said.
    He added he saw the price resistance levels at around 44
euros.
    The Nordic region relies on hydroelectric power for more
than 50 percent of its power generation, and change in
precipitation is an important factor in setting prices.
    The Nordic contract for baseload power delivery next year
 was up by 15 cents to 38.35 euros per MWh.
    Coal API2 2013 futures traded lower by 10 cents
to $97.25 a tonne, while European carbon prices were
unchanged at 7.92 euros a tonne.
    Brent crude futures rose towards $113 a barrel on Tuesday,
due to fears that escalating tensions in the Middle East cut
supply. 
    Elsewhere, Saudi Arabia, OPEC's biggest oil producer, said
on Tuesday oil prices have come down to suitable levels for
consumers and producing countries. 
    Brent crude has fallen from a high for the year of $128 a
barrel in March.

 (Reporting by Nerijus Adomaitis; Editing by Mike Nesbit)
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