Tuesday, 21 September 2010

Prompt up on tight supply margins, higher gas prices

UK short-term power prices jumped to a two-week high Tuesday as traders said
supply margins were tighter and UK
commercial gas prices higher.

UK OTC baseload power for next-day delivery was assessed at GBP40.25/MWh by
1200 London time, up 95 pence from Monday. This is the first time that the
contract has gone above GBP40/MWh since September 8.

The peakload contract was assessed at GBP46/MWh, up GBP1.50. On the N2EX
wholesale power exchange, the day-ahead auction cleared at
GBP40.96/MWh, GBP1.43 higher on the day.

"The system is not really comfortable and gas has increased a lot," a trader

"The system is tighter...but not much tighter than last week," another
trader said. "It's the same as last week but with less wind."

National Grid forecast power supply margins at 10.2 GW Wednesday, up 2.8 GW
from Tuesday. But margins are set to tighten further towards the end of the


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