Volatile gas price prevents further drop in electricity price

Although last week's dips were not in sight, the electricity price was again relatively favorable this week. On Tuesday, May 30, the EPEX recorded a reading of €84,42 per megawatt hour, the highest reading of the week. Then the price fluctuated up and down. On Sunday, June 4, electricity recorded the lowest level of €44,54. 

It seems that the summer weather is pushing the electricity price down a little further. The production of solar energy in particular remains an important factor. 38,6% of all electricity was generated by solar collectors. In total, no less than 73% of all electricity was generated renewablely. The fact that the price did not fall further is the result of volatility on the gas market. The mood at the TTF is clearly still nervous. Due to lower LNG import volumes and work on Norwegian gas fields, the gas price rose by as much as 31% in just a few hours on Wednesday, May 15. That same day, the gas price fell again by 10%. However, the unrest has not yet ended. On Monday, June 5, the gas price rose again by approximately 15% from €23,69 to €27,86.

Energy costs remain a cause for concern
This also explains the relatively high floor for electricity prices. Although prices have fallen significantly compared to last summer's peak, electricity prices have not yet reached pre-Ukraine war levels. Before the war, electricity prices were usually around €30 to €50 per megawatt hour. Although the floor prices are now lower due to the increased production of renewable electricity, the price is usually higher and the end user notices this. It should therefore come as no surprise that energy costs are still one of the most important concerns for entrepreneurs. More than two in three entrepreneurs still indicate that they are concerned about high energy costs, according to the annual Energy Transition Benchmark 2023 of the Groendus business platform.

To reduce high energy costs, more and more entrepreneurs are choosing to generate energy themselves. Groendus' research shows that half of all entrepreneurs now produce energy themselves. About 86% of all respondents do this with solar panels. In addition, more and more entrepreneurs appear to be making extensive plans to reduce their consumption. 61% of all entrepreneurs prepare so-called energy reports to see where savings are still possible. There also seems to be a lot of interest in energy storage. Although the technology is still in its infancy, one in three respondents indicate that they are interested in a home battery.

The government is committed to acceleration
In addition, the Ministry of Economic Affairs and Climate indicates in a press release that it is working hard on the security of energy supply. The government is currently trying to strengthen ties with energy-producing countries. 

The government is currently focusing on the purchase of gas, but it is expected that the import of hydrogen will also form an important pillar of Dutch energy policy in the future. That is why the Dutch government wants to realize a hydrogen network as quickly as possible. Although the Netherlands plans to convert excess electricity from offshore wind farms into hydrogen, the Netherlands also foresees a role for imports. To prevent the Netherlands from becoming too dependent on one supplier, as is the case with the purchase of gas, the Netherlands wants to strengthen ties with various countries.

Although no production has yet taken place in practice, the Netherlands has already started collaboration with Norway, Portugal, Chile, Uruguay, Namibia, Canada, United Arab Emirates, Oman, Australia, Spain and Saudi Arabia. As far as the government is concerned, that network must grow as quickly as possible. That is why the Netherlands plans to conclude similar deals with countries in North America, the Gulf region and Africa. In addition, the Netherlands has agreed with Germany to set up a cross-border hydrogen infrastructure as quickly as possible.