Back to school, an update on the various fundamentals

On the supply side, nuclear power is generally the main driver at this time of year. Uncertainties about the impact of COVID on maintenances are joined by environmental constraints, which as often after a dry summer do not disappear with the autumn…
Last week we saw less than 30GW of nuclear production, 10GW less than in 2019!

If we look at the forecasted schedules, availability should increase by nearly 10GW between today and October. Such an increase, unprecedented for many years, seems very (too?) ambitious. These operations could indeed suffer from bottlenecks in terms of resources on the operator’s side but also on the regulator’s side. 

We continue to believe that the availability observed in Q4 will be much lower than that forecasted today.
In any case, this year more than any other, any early cold spell could be difficult to manage, despite good hydraulic stocks and lower consumption than in previous years (see next paragraph).

History of nuclear availability

With a small and discreet product placement because the view is taken from our new Genius graphical interface…

On the demand side, consumption seems to have returned to levels almost similar to those preceding the health crisis in Germany, Italy and Spain. France, however, is lagging behind with demand struggling to recover, we see  around 2GW of demand destruction according to our analyses. To estimate this impact, we are providing a free tool that allows us to follow our forecasts from a model calibrated before the coronavirus crisis. A comparison with actual consumption gives an order of magnitude of what “should have been” consumption.

The price of CO2 fell sharply last week. Highly speculative, this market followed the optimism of the equity markets in August, and accompanied their downward correction last week.  Despite good confidence in the European recovery package, which should keep prices stable, this market is to be watched closely. 

Gas and Coal are also on the rise, but vigilance is needed as the signals are contradictory. Although the economic recovery seems to be taking shape, stocks remain high and renewable capacity is constantly increasing, reducing the need for fossil fuels.

Contact us to obtain our forecasts of nuclear availability, demand and renewable production: we offer these supply & demand models, essential components of the price of electricity, for sale.

Our teams are at your disposal to talk to you about them.

Emeric de Vigan
COR-e Founder and CEO

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