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Analysis Electricity

Electricity price remains stable despite coal boycott

12 April 2022 - Jurphaas Lugtenburg

Electricity prices didn't make any crazy jumps this week. This is partly due to a relatively large supply of sustainable energy. First the windy and later the sunny weather played a role in this. Nevertheless, coal also remains a significant factor, as this week showed in the negotiations on sanctions against Russia.

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The EPEX spot quotation for electricity reached the highest level of the past week on Tuesday 5 April: €239,18 per MWh. Saturday, April 10, the price closed at €180,90 per MWh. That was the lowest price. Price fluctuations have therefore been kept within limits, although electricity continues to be expensive.

In the Netherlands, according to data from energieopwek.nl, last week 54% of the electricity consumed was generated sustainably. That is a record in the Netherlands. In recent days, however, it has also become painfully clear that the role of coal in the European electricity supply has not yet been played out. After days of negotiations, European member states are out and the sector is no longer spared in the sanctions against Russia. The first step being taken in this area is a ban on coal imports from Russia. There was a lot of discussion about this within the European Union. In Poland and Germany in particular, coal still occupies a prominent place in the energy mix.

Symbolic act
Several critics believe that the ban is mainly symbolic politics. The Russian budget is about 40% dependent on oil and gas exports. Coal plays a minor role for export. In addition, the European Union also has its own coal reserves and although several mines are closed, there is room to increase production in the not too distant future. The Kremlin reports in a response that it will deliver to other destinations. Anyway, experts see the embargo mainly as a test case for a possible follow-up with oil first.

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