EUROPE GAS-Prices edge higher on weaker renewable power forecasts

EUROPE GAS-Prices edge higher on weaker renewable power forecasts

LONDON, July 10 (Reuters) – Dutch and British gas prices edged higher on Wednesday morning as forecasts for weaker output from renewable generators increased demand for gas from gas-fired power plants.

The benchmark front-month contract at the Dutch TTF hub was up 0.35 euros at 31.45 euros per megawatt hour (MWh), or $9.97/mmbtu, by 0819 GMT, LSEG data showed.

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The Dutch day-ahead contract was up 0.36 euros at 31.20 euros/MWh.

In the British market, the front-month contract rose by 1.2 pence to 73.6 pence per therm.

“Gas-fired generation is expected to rebound slightly amid forecasts of lower renewable generation,” analysts at Engie EnergyScan said in a daily research note.

The analysts said wind and solar generation in Germany is expected at 21,735 megawatts (MW) on Wednesday compared with 25,813 MW on Tuesday.

In Britain, peak wind generation was forecast at 10.2 gigawatts (GW) on Wednesday, falling to 9.1 GW on Thursday, Elexon data showed.

“Supply side drivers are mostly bearish, strong Norwegian production and continuation of elevated imports from the UK keep storage filling on course to be at required levels ahead of winter,” said LSEG analyst Wayne Bryan.

Europe’s gas storage sites were 79.6 % full, according to latest data from Gas Infrastructure Europe.

There is still no sendout from France’s Monitor LNG terminal after maintenance, which had been due to end on July 8 but was extended until July 22, while Germany’s Wilhelmshaven terminal is also offline due to maintenance.

In the European carbon market, the benchmark contract rose by 0.74 euros to 69.30 euros per metric ton.

(Reporting By Susanna Twidale; Editing by Sonia Cheema)