Not only was the weather stormy in recent days, the electricity market also had a turbulent week. It is striking that the supply of sustainably generated energy has a strong price-depressing effect.
The price for electricity, listed on the EPEX Spot Listing, has shown large fluctuations. On Tuesday, February 17, electricity was €202,10 per MWh, the highest price of the past week. On Saturday, February 19, the quotation was at its lowest point, at €95,72 per MWh. In the days between Christmas and New Year's Day - when demand was much lower - this quotation fell below that level for a few days. If we ignore that period, November 1 was the last time the price was below €100 per MWh.
Analysts are unanimous about the cause of the price fluctuations. This is due to the storms that passed over the country and provided a wide supply of wind energy. In addition, the sun is also starting to gain more strength. On clear days, solar panels take up a growing share of the Dutch energy mix.
Strategic choice
It has often happened in recent months that green energy is cheaper than gray energy. Several major players in the European energy market are making extra efforts to become greener and less dependent on fossil fuels for various reasons. In the long term, this strategy can be positive for Europe. The European Union is now largely dependent on Russia and the Middle East for energy supplies. Politically speaking, these are not exactly the most stable regions. So; The sooner Europe makes itself independent of those areas, the better it will be, according to analysts' reasoning.
However, there is a downside to the strategy. A company can only spend its money once. What is invested in sustainability and low-carbon alternatives for energy supply comes at the expense of investments in conventional fossil sources. This leads to underinvestment in the 'old' techniques, resulting in a shortage on the market.
According to experts, the coin can go both ways. On the one hand, the current tightness in the market can become a driver for further investments in sustainable energy; Whether or not in combination with targeted government policy, the current energy bill is a sour apple that we now have to bite through. If the coin turns the other way, the current prices could actually provide an incentive for energy companies to invest additionally in fossil energy sources and to abandon their green ambitions.