Record levels of renewable generation and mild winter weather led to falling wholesale electricity prices in the first quarter of 2024.
This was the standout highlight of a new report on the GB electricity market by Teesside-based energy data analyst Montel EnAppSys.
In the first three months of this year, average wholesale electricity prices fell by 22% from the previous quarter, the report said, with an average day-ahead price of £64.57/MWh in EPEX auction and £64.45/MWh in Nordpool. This was almost half the level seen for the same quarter last year and down from the £82.50/MWh average price in the previous quarter.
The fall in Q1 2024 was attributed to generally mild weather and an increase in power generated by renewable sources, which hit a record high of 35.40TWh. This was the highest quarterly figure ever recorded in the GB market and represented almost one half (47%) of Britain’s overall fuel mix. Wind output dominated the renewables mix, rising to a record high for any Q1 (25.2TWh), while biomass (6.7TWh), solar (1.9TWh) and hydro (1.6TWh) all boosted Britain’s clean energy output during the quarter.
CCGT utilisation fell to 21.8TWh from the 23.5TWh recorded in Q1 2023 as a result of increased renewable generation, while several outages in Britain’s nuclear fleet saw generation from this power source reduce from 9.6TWh in Q1 2023 to 7.9TWh.
Imports into GB increased by 75% compared to the previous quarter to contribute 9.1TWh, representing 12% of GB electricity consumption, with the majority of power coming from France (4.8TWh).
Paul Verrill, director of Montel EnAppSys – which is part of the Montel Group – said: “Wholesale electricity prices were generally on a downward trend through the quarter, and dipped to very low levels during some weekends in January and February and subsequently below £0/MWh in the fourth week in March during periods of very low demand coupled with high renewable generation.
“This downward trend was driven primarily by declining gas prices, reflecting limited storage drawdowns owing to generally mild weather conditions, despite the cold spell in early January. Gas prices opened the year at £27.98/MWh and declined through the quarter, reaching as low as £19/MWh on February 19 before climbing to moderate levels and closing the quarter at £24.40/MWh.
“Record levels of renewable generation also exerted downward pressure on wholesale electricity prices, driven mainly by high levels of wind output. Based on our data, wind generation reached a record-breaking 21.87GW between 18:00-18:30 on January 10, surpassing the previous record of 21.80GW set on December 21 2023 between 8:00-8:30.
“Multiple outages in nuclear plants at Hartlepool 1 and 2, Heysham 2-7 and Torness 1 significantly reduced the output capacity of the nuclear fleet during Q1. Although the restart dates for most units were delayed by about a week, they are now operational again, except for Hartlepool 2.
“France maintained its position as the top exporter of power to GB, with 4.8TWh flowing from France to GB, followed by exports from Norway totalling 2.1TWh. This trend was driven by consistently low power prices in France and Norway throughout the quarter compared to other European countries bordering GB. However, in Q1, French nuclear output showed signs of decline from peak levels of over 45GW to approximately 40GW by the quarter’s end. Despite this decrease, French nuclear output remained high compared to Q1 2023. Meanwhile, the extra capacity introduced by the Viking Link connecting GB and Denmark, which commenced operations at the close of 2023, contributed 1.2TWh to overall capacity in Q1 2024.”
Renewables generation (wind, biomass, solar and hydro) was the largest contributor to the GB power generation mix during Q1 2024, accounting for 47% of the total output. Gas-fired generation made up 29% of the total, with imports (12%), nuclear (10%) and coal (1%) accounting for the rest.