Innovative Energy Consultancy Ltd
Innovative Energy Consultancy Ltd

September gas and power market update

Gas market trends

What’s been happening?

  • All seasonal gas prices decreased in August. The annual October 16 gas contract lost 6.0% to 40.0p/th. Winter 16 gas experienced the largest drop, at 6.1%, to average 42.0p/th. Summer 17 gas decreased 5.8% to 38.0p/th.
  • Day-ahead gas moved 10.2% lower to average 31.1p/th. On 31 August the contract reached its lowest price in over six years of 26.0p/th.

Key market drivers

Centrica announced that it will make 20 wells available at Rough gas storage facility from 1 November 2016. This has improved the supply outlook for the coming winter and pulled the winter 16 price down to reach a two-and-a-half-month low of 39.8p/th on 31 August.


* £ per p/therm (Annual Forward Average)

Power Market Trends

What’s been happening?

  • The annual October 16 baseload power contract fell 3.0% to average £42.4/MWh, following the gas market lower.
  • The day-ahead contract started the month at a six-month high of £42.0/MWh before decreasing as the month progressed to £33.1/MWh on 31 August. The month-ahead contract dropped 5.6% to average £37.6/MWh during August.

Key market drivers

  • The winter 16 power contract lost 2.8% to average £45.8/MWh. The contract followed its gas counterpart lower, which dropped on news that Rough gas storage facility would have some available capacity for the coming winter. Summer 17 decreased 3.2% to £39.0/MWh.

*£ per MWh (Annual forward average)

European Markets

  • All European gas prices decreased in August. GB gas prices ended the month 1.3% below Belgian prices, 6.9% lower than German prices and 3.4% below Dutch prices. Prices were pushed down by high UK exports and lower oil prices.
  • European power prices were mixed in August. French prices experienced the largest overall gain, up £4.2/MWh to £33.5/MWh. GB prices ended the month 4.1% below the continental European average of £29.1/MWh.


Commodity markets

  • Brent crude oil prices lost 0.2% to average $46.7/bl in August. Prices have fallen from their near eight-month high of $52.2/ bl in June. This was caused by continuing concerns of oversupply in the market and uncertainty in global markets.
  • API 2 coal lost 1.3% to average $58.3/t. Prices fell on the back of lower European demand levels. In the UK specifically, coal-fired power generation in Q216 hit a record low.
  • EU ETS carbon gained 1.7% to average €4.7/t. On 2 August the price of EU ETS carbon fell to €4.4/t, the lowest price since March 2014.








Thank you! Your subscription has been confirmed. You'll hear from us soon.
Sign up to receive Energy Brief, which includes our monthly report on Industry News and Market Price Trends.