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European Power Trading Rose to Record in 2009 Amid Price Plunge
2010-07-22 23:07:01.0 GMT
By Lars Paulsson
July 23 (Bloomberg) -- Electricity trading in western
Europe's seven biggest markets rose to a record for a fifth year
in 2009 as banks and utilities including Barclays Capital and
E.ON AG bought and sold amid a 40 percent drop in power prices.
Volumes in Germany, the Nordic region, Britain, France, the
Netherlands, Spain and Italy increased to 9,944 terawatt-hours
from 9,929 terawatt-hours in 2008, London-based consultant
Prospex Research Ltd. said in a report scheduled to be released
today. They have advanced 21 percent since 2005, the data show.
European power prices plummeted as the global economy
suffered its worst recession since World War II, damping demand.
The first slump in volumes since 2003 in the Nordic region,
which encompasses Denmark, Finland, Norway and Sweden, was
offset as traders bought and sold more in Germany and the U.K.
"The trading business had a reasonably good year,
considering the turmoil" in the world economy, Prospex Director
Ben Tait said in a telephone interview from London yesterday.
"A handful of the big banks have kept the market going because
of their strong relationships with industrial customers."
Utilities including Electricite de France SA and RWE AG
trade with banks such as Bank of America's Merrill Lynch, which
deal for industrial and financial clients and themselves.
Germany, E.ON
Volumes in Germany, Europe's biggest power market, rose 5
percent last year, trading at a rate of about 8.4 times annual
consumption, Prospex said. German demand was about 515 terawatt-
hours in 2009. Prospex declined to specify volumes for
individual markets. Dusseldorf-based E.ON, Germany's biggest
utility, boosted its European power trading by 41 percent last
year to 1,240 terawatt-hours, it said March 10.
Trading in Britain and Italy rose by 19 percent and 18
percent respectively. Spanish volumes increased 5 percent and
the French market was unchanged last year, Prospex said. The
Nordic region fell 14 percent and the Netherlands slid 7
percent.
The amount of electricity changing hands in the Nordic
market was 6.7 times demand last year, down from 7.3 times
actual physical consumption a year earlier. In the U.K. market
3.3 times demand was traded, compared with 2.7 times in 2008.
Trading outside organized exchanges, the so-called over-
the-counter market, last year regained volumes it lost in 2008.
It accounted for a total of 82 percent of trades, compared with
71 percent reported by Prospex in its 2008 survey.
Brokers including ICAP Plc, GFI Group Inc., Tullet Prebon
Plc, Spectron Group Ltd. and Tradition Financial Services
compete for over-the-counter trades.
The average annual power price slid by more than 40 percent
in Germany, the Netherlands, Spain and the U.K. last year,
Prospex said. The average day-ahead price for Germany on the
Epex Spot SE exchange in Paris fell 41 percent to 39 euros a
megawatt-hour, according to broker prices on Bloomberg.
For Related News and Information:
European power-market stories TNI EUROPE PWRMARKET <GO>
Today's top power news PTOP <GO> and energy news ETOP <GO>
European power-markets home page EPWR <GO>
--Editors: Rob Verdonck, John Buckley.
To contact the reporter on this story:
Lars Paulsson in London at +44-207-673-2759 or
lpaulsson@bloomberg.net
To contact the editor responsible for this story:
Stephen Voss at +44-20-7073-3520 or sev@bloomberg.net
