4 ms·

European Energy Crisis: price per MWh now above 300 EUR in many countries

35 points by wsc981 5y ago

ElDji 5y ago
EU commission wanted free market. It will lower energy prices, they said. That worked quite well isn't ?
- kmlx 5y ago
  june 2020 had the lowest ever prices. no one was complaining. in reality these high prices are due to a combination of factors: - countries reopened after covid at the same time across the planet leading to pressure from asia to europe - norway’s gas infrastructure works - cold winter and spring followed by a very hot summer which increased energy demand for heating and AC - lack of wind in northern Europe meaning burning more coal and gas - fire at a Russian gas processing plant in August reducing output from Russia to Europe. thus Russia couldn’t fulfil anything more than long-term contracts (no spot) - Russia’s Putin also has an interest to put pressure on Europeans in order to fast track Nord Stream 2. - Putin also wants Europeans to rely less on the free market and more on long term contracts, since those disincentivise investments in energy efficiency, diversification, the transition to cleaner energy sources. EU initiatives have also made Europe less susceptible to market manipulation by Gazprom than it used to be. these are big no-no’s for the Kremlin
  - Ekaros 5y ago
    Also I think Norway's reservoir levels are low. Which also affects prices as they are likely to import some energy.
- djbebs 5y ago
  Even ignoring the fact that this isn't a free market by any stretch, the fact is the EU imposes massive costs which will necessarily be reflected in the price of electricity. For example, about 60% of the cost of electricity in Poland is tied up in buying carbon credits [1]. Now you may agree with the existence of such a system, but that doesn't make its consequences cease to be. [1] https://twitter.com/michal_1979/status/1472635201226428416?t=ZqtOMrLWC6E_poC3Q7LIrw&s=19 https://twitter.com/michal_1979/status/1472635201226428416?t...
  - ZeroGravitas 5y ago
    'Free Market' doesn't mean 'no regulation', in fact the existance of externalites prevents a free market from functioning as it is supposed to.
    - djbebs 5y ago
      It actually does. When your regulations is interfering with the normal functioning and price discovery of the market, you're not in a free market. You might be able to argue that regulations that simply provide market participants with additional information dont interfere with that, but carbon credits are most certainly not that. You may agree with the regulations, but that doesnt maoe them any less nefarious.
      - ZeroGravitas 5y ago
        That's literally what Carbon credits are. That indeed is the whole point of economists proposing them as a mechanism. What do you think they are if not that? Note electricity is and always has been a highly regulated industry, but Carbon Credits are in fact a move towards more market signals. You might disagree with the shared consensus reality, perhaps you think CO2 is a hoax molecule invented by the Swiss as a prank, but even then, Carbon Credits are clearly an attempt to price in this fictitious molecule and apply market signals to it.
        djbebs 5y ago
        Except carbon credits are not providing information, they are imposing costs. The 2 are not one and the same. You might argue that electricity providers having to inform their customers of how much carbon was generated in the production of electricity is simply informing the customer and therefore compatible with a free market. You cannot make that argument when the state is imposing the legal requirement to purchase licenses to output said carbon. Again, you may agree with such a measure (I don't), but agreeing with the measures doesn't change their nefarious effects.
ipspam 5y ago
Self inflicted problems. This is largely a result of an inability to stock and store large amounts of natural gas due to climate change activists getting their way. Hopefully this coming nightmare of a winter will dispel people of their fantasies about transitioning to a green economy fast.
maratc 5y ago
Interesting why France (with its nuclear power plants) and Switzerland (with hydro) have the highest prices.
- Bayart 5y ago
  Most of the energy in France is tied to long term contracts. Spot market prices aren't really meaningful.
- StephenAmar 5y ago
  There had to shutdown a few plants in the past few days. https://www.reuters.com/world/europe/edf-shares-plunge-after-faults-found-french-nuclear-power-station-2021-12-16/ https://www.reuters.com/world/europe/edf-shares-plunge-after...
deleted 5y ago
[deleted]
interactivecode 5y ago
Hopefully this speeds up the adoption of solar panels. We have the tech to be less reliant on fossil fuel and ee should be doing that
- Reichhardt 5y ago
- nyokodo 5y ago
  > Hopefully this speeds up the adoption of solar panels Except the solar energy potential in Northern Europe is too low to be cost effective. Going big on solar isn’t going to lower prices.
myridium 5y ago
Guess that's what happens when you shut down safe, cheap, emissions-free sources of electricity for nonsense ideological reasons (nuclear power plants).
- hyperman1 5y ago
  At least in Belgium, I have the impression the nuclear reactors are end of life and based on obsolete designs. They already did a few emergency stops and underwent expensive repairs. The right question should have been if they should be replaced. Which is a lot harder to sell .
TrackerFF 5y ago
I'm currently paying around 0.02 EUR / KWh (or 20 EUR / MWh) here in Norway, though in a much cheaper area - so luckily I got / am getting through this pretty smoothly. But for a country that has been blessed with low energy prices, it's currently a very hot topic.

35 points by wsc981 5y ago

ElDji 5y ago

EU commission wanted free market. It will lower energy prices, they said. That worked quite well isn't ?

kmlx 5y ago
june 2020 had the lowest ever prices. no one was complaining. in reality these high prices are due to a combination of factors: - countries reopened after covid at the same time across the planet leading to pressure from asia to europe - norway’s gas infrastructure works - cold winter and spring followed by a very hot summer which increased energy demand for heating and AC - lack of wind in northern Europe meaning burning more coal and gas - fire at a Russian gas processing plant in August reducing output from Russia to Europe. thus Russia couldn’t fulfil anything more than long-term contracts (no spot) - Russia’s Putin also has an interest to put pressure on Europeans in order to fast track Nord Stream 2. - Putin also wants Europeans to rely less on the free market and more on long term contracts, since those disincentivise investments in energy efficiency, diversification, the transition to cleaner energy sources. EU initiatives have also made Europe less susceptible to market manipulation by Gazprom than it used to be. these are big no-no’s for the Kremlin
- Ekaros 5y ago
  Also I think Norway's reservoir levels are low. Which also affects prices as they are likely to import some energy.
djbebs 5y ago
Even ignoring the fact that this isn't a free market by any stretch, the fact is the EU imposes massive costs which will necessarily be reflected in the price of electricity. For example, about 60% of the cost of electricity in Poland is tied up in buying carbon credits [1]. Now you may agree with the existence of such a system, but that doesn't make its consequences cease to be. [1] https://twitter.com/michal_1979/status/1472635201226428416?t=ZqtOMrLWC6E_poC3Q7LIrw&s=19 https://twitter.com/michal_1979/status/1472635201226428416?t...
- ZeroGravitas 5y ago
  'Free Market' doesn't mean 'no regulation', in fact the existance of externalites prevents a free market from functioning as it is supposed to.
  - djbebs 5y ago
    It actually does. When your regulations is interfering with the normal functioning and price discovery of the market, you're not in a free market. You might be able to argue that regulations that simply provide market participants with additional information dont interfere with that, but carbon credits are most certainly not that. You may agree with the regulations, but that doesnt maoe them any less nefarious.
    - ZeroGravitas 5y ago
      That's literally what Carbon credits are. That indeed is the whole point of economists proposing them as a mechanism. What do you think they are if not that? Note electricity is and always has been a highly regulated industry, but Carbon Credits are in fact a move towards more market signals. You might disagree with the shared consensus reality, perhaps you think CO2 is a hoax molecule invented by the Swiss as a prank, but even then, Carbon Credits are clearly an attempt to price in this fictitious molecule and apply market signals to it.
      - djbebs 5y ago
        Except carbon credits are not providing information, they are imposing costs. The 2 are not one and the same. You might argue that electricity providers having to inform their customers of how much carbon was generated in the production of electricity is simply informing the customer and therefore compatible with a free market. You cannot make that argument when the state is imposing the legal requirement to purchase licenses to output said carbon. Again, you may agree with such a measure (I don't), but agreeing with the measures doesn't change their nefarious effects.

ipspam 5y ago

Self inflicted problems. This is largely a result of an inability to stock and store large amounts of natural gas due to climate change activists getting their way. Hopefully this coming nightmare of a winter will dispel people of their fantasies about transitioning to a green economy fast.

maratc 5y ago

Interesting why France (with its nuclear power plants) and Switzerland (with hydro) have the highest prices.

Bayart 5y ago
Most of the energy in France is tied to long term contracts. Spot market prices aren't really meaningful.
StephenAmar 5y ago
There had to shutdown a few plants in the past few days. https://www.reuters.com/world/europe/edf-shares-plunge-after-faults-found-french-nuclear-power-station-2021-12-16/ https://www.reuters.com/world/europe/edf-shares-plunge-after...

deleted 5y ago

[deleted]

interactivecode 5y ago

Hopefully this speeds up the adoption of solar panels. We have the tech to be less reliant on fossil fuel and ee should be doing that

Reichhardt 5y ago
nyokodo 5y ago
> Hopefully this speeds up the adoption of solar panels Except the solar energy potential in Northern Europe is too low to be cost effective. Going big on solar isn’t going to lower prices.

myridium 5y ago

Guess that's what happens when you shut down safe, cheap, emissions-free sources of electricity for nonsense ideological reasons (nuclear power plants).

hyperman1 5y ago
At least in Belgium, I have the impression the nuclear reactors are end of life and based on obsolete designs. They already did a few emergency stops and underwent expensive repairs. The right question should have been if they should be replaced. Which is a lot harder to sell .

TrackerFF 5y ago

I'm currently paying around 0.02 EUR / KWh (or 20 EUR / MWh) here in Norway, though in a much cheaper area - so luckily I got / am getting through this pretty smoothly. But for a country that has been blessed with low energy prices, it's currently a very hot topic.