Dutch power strengthens amid solar weakness, gas market tightness

Despite a significant increase in wind generation, with output rising 53% week-on-week in Germany and 57% in the Netherlands, solar generation declined by approximately 30% in both markets. The reduction in solar supply during daylight hours helped sustain elevated prices throughout the week, particularly during peak hours. Further support to Dutch peak prices came from transmission constraints and generation outages. On 20, 21 and 22 August, gas units EEMS 3, 4, 5, 6 and 7 were unavailable between 07:00 and 17:15, limiting domestic generation availability during solar hours. Additionally, exports from Denmark to the Netherlands were also restricted on 19, 20 and 21 August between 07:00 and 17:00. As a result, the Dutch peak prices increased by €27.6/MWh week-on-week to €120/MWh.

Prices remained elevated for most of the week, ranging between €147.7/MWh and €176.8/MWh, before easing towards the weekend as both wind and solar generation strengthened. Consequently, average daily prices fell to €102.9/MWh on Saturday and further to €86.8/MWh on Sunday. On Sunday, high combined renewable generation led to six consecutive hours of negative power prices in the Netherlands.

Meanwhile, the Dutch TTF gas contract continued its bullish trajectory, with prices surpassing €65/MWh during the week and averaging €63.8/MWh, up €4.4/MWh week-on-week. Gas prices were supported by lower-than-normal EU gas storage levels, slow refill rates ahead of the winter season, and growing geopolitical supply risks linked to tensions in the Middle East threatening global LNG supplies. In addition, persistent summer heat across Europe boosted cooling demand, increasing gas-fired power generation requirements and providing further support to gas prices.