Nordic Power Climbs as Forecasters Point to Cooler Temperatures
March 6 (Bloomberg) -- Nordic power for next week climbed for the seventh day as forecasts signaled cooler temperatures and the cost of carbon emission permits rose.
Power for the week starting March 11 gained as much as 2.6 percent on Nasdaq OMX Group Inc.’s energy exchange in Oslo. Temperatures in Sweden, Finland and Denmark for the next 10 days dropped below earlier forecasts, MetraWeather data on Bloomberg using the ECMWF model show.
The amount of water and snow available to generate electricity in the Nordic region may be 18.1 terawatt-hours below normal for the time of year in two weeks, down from minus 15 terawatt-hours today, Markedskraft data on Bloomberg show. Drier weather boosts prices as the area gets more than half of its power from hydroelectric plants.
European Union carbon prices rose as much as 5.7 percent, which can add to the generation costs at power plants fueled by coal and gas.
Nordic power for next week traded at 44.90 euros ($58.50) a megawatt-hour at 2:57 p.m. in Oslo. The next-quarter contract rose 0.3 percent to 37.25 euros, while power for April rose 0.7 percent to 39.20 euros.
Power for delivery around the clock tomorrow will cost 41.41 euros a megawatt-hour on average, following today’s auction on the Nord Pool Spot AS exchange in Oslo. That’s more than the financial contract for tomorrow on Nasdaq OMX, which had a bid-ask spread of 40.50 to 40.90 euros.
Temperatures in Sweden may average minus 3.7 degrees Celsius (25 Fahrenheit) over the next 10 days, 0.3 degrees less than an earlier forecast, MetraWeather data show. Temperatures in Finland will average minus 8.6 degrees, while Denmark will average minus 1.6 degrees.
Nordic hydropower reservoirs were 41.1 percent full on March 3, down by 2.9 percentage points from a week earlier, and with an energy content of 49.9 terawatt-hours, according to data from Nord Pool Spot. That’s roughly twice Denmark’s annual electricity use.
--Editors: Andrew Reierson, Rob Verdonck