It remains a remarkable phenomenon: if there is little supply of solar or wind energy, the price of renewable energy fluctuates much less than when the sun shines exuberantly and the wind blows hard. This week, the daily and hourly price of electricity varied very little.
While the capacity of wind energy (particularly at sea) and solar parks is growing rapidly, the financial reward is not forthcoming. The opposite threatens. This also applies to the price of CO2 rights. Despite the growing European support for strong pricing of CO2 emissions, the price of CO2 allowances has fallen again this week.
Despite all policy intentions, the reality of market forces prevails in corona time. If there is more supply than demand, the price falls. Due to the corona crisis, the demand for energy has fallen sharply and so has the price of energy. Without subsidies, the production of renewable energy would be completely unprofitable under these circumstances.
Oil and gas price remarkably stable
The second corona wave in Europe has so far not resulted in unrest in the gas and oil market, unlike the first wave. The price hardly fluctuates and analysts do not expect a rapid decline in the short term. The approaching winter, which will rapidly increase heat demand in the Northern Hemisphere, is supporting gas and oil prices.
Agricultural diesel continues to move at a daily price level between €0,85 and €0,90 per liter (excluding members and volume discounts and VAT). More wind is likely to blow in the coming week, which could increase the imbalance in the electricity market and thus also price fluctuations.
Receipt for biomass policy
A more constant power supply through extra energy from biomass could be a solution for this imbalance. But energy production from woody biomass is heavily criticized. That is why the House of Representatives organized a hearing about the alternatives this week. The outcome of the discussions with various energy market experts does not provide a clear solution for the time being. Opinions are very divided about how bad the burning of wood (chips) in heat plants actually is for CO2 emissions and biodiversity.
If no more CO2 is captured by forest that is planted than is released into the air through combustion, then the effect is negative on balance. The fact is that most European countries are much less dependent on oil and gas than the Netherlands, precisely because of burning woody biomass. The Scandinavian countries and the Baltic states are leaders in energy production from woody biomass in the European Union.
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