Gas Market Strength Keeps Dutch Power Prices Elevated

Weekly solar generation declined across the region, with Dutch output down 15% week-on-week and German solar production falling by 13.4%. However, these losses were more than offset by a strong increase in wind generation across Northwestern Europe. Wind output rose by 36% in the Netherlands, 23% in Germany, and 20% in Belgium, significantly boosting renewable supply. The stronger wind generation primarily impacted peak-hour pricing, with the Dutch peak-load contract averaging €86.8/MWh, down €4.6/MWh week-on-week. Nevertheless, baseload prices remained elevated as higher gas costs and thermal generation constraints continued to support the market during periods when dispatchable generation was required.

Several key Dutch gas-fired power plants remained unavailable during the week, limiting gas generation availability. Moerdijk 2 (426 MW), Eems 3 (359 MW) and Hemweg 9 (440 MW) remained unavailable throughout the week, while Eems units 4, 5, 6 and 7 (359 MW each) were unavailable until 5 September. Rijnmond 2 (427 MW) also remained unavailable until 6 September 14:00. The reduced availability of gas-fired capacity helped support power prices, particularly during periods of lower renewable generation.

TTF day-ahead gas prices strengthened in Week 35, averaging €70.7/MWh, up €3.9/MWh week-on-week from €66.9/MWh. Prices climbed steadily through the week, reaching a high of €73.0/MWh on Thursday before easing slightly towards the weekend. The day-ahead contract remained at a small discount to the month-ahead contract throughout most of the week, indicating that the rally was driven more by strength across the forward curve than by tight prompt market fundamentals. Geopolitical tensions remained the key bullish driver. Escalating hostilities in the Middle East, including renewed exchanges between the US and Iran and concerns over potential disruptions to shipping routes near the Strait of Hormuz, increased fears over LNG supply risks. With European gas storage levels still below seasonal norms, the market remained highly sensitive to any threat to winter supply security.

On the interconnection side, the 723 MW NorNed interconnector (NL-NO), which was initially scheduled to return from maintenance on 5 September, had its unavailability extended until 10 September. Meanwhile, the 1016 MW BritNed interconnector (NL-GB) entered planned maintenance from 6 September to 20 September, reducing transfer capacity in both directions