New Heat Wave to Lift European Power Prices, Threaten Reactors

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Or sign-in if you have an account.High voltage electricity transmission lines in Kemlitz, Germany. Photographer: Krisztian Bocsi/Bloomberg Photo by Krisztian Bocsi /Bloomberg(Bloomberg) — European power prices are expected to rise this week as another heat wave spreads across parts of the continent, raising electricity demand and threatening to curb output from France’s nuclear fleet.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountAbove-average temperatures are forecast across much of Europe from Tuesday. Madrid is expected to reach 39C for several days, Paris could hit 38C on Wednesday and Berlin may see temperatures as high as 37C on Thursday, according to weather forecaster Vaisala.Electricite de France SA said that its Golfech 2 reactor will be offline for a week starting from Thursday due to environment issues, and warned it may reduce output at its Tricastin nuclear plant from Aug. 1 as high temperatures in the Rhone River could trigger environmental limits on cooling water. That’s a sign that the latest hot weather may once again strain Europe’s electricity system. Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againEarlier heat waves this summer showed how prolonged high temperatures tightened Europe’s power market. French nuclear plants rely on river water for cooling, and environmental rules limit how much heated water they can return to rivers. As water temperatures rise, reactors sometimes have to reduce output to stay within those limits. According to an ICIS report published this week, restrictions in June and July resulted in the largest heat-related losses of French nuclear generation in at least a decade. Traders expect higher power prices, although not as as severe as during the previous heat wave.“There will be price spikes in some evening hours, but they are unlikely to be as extreme as during the last heat wave,” said Talha Torlak, short-term trading lead at Vitus Commodities in Turkey. “There are fewer restrictions on French nuclear plants and wind generation is relatively high.”German power prices for 8 p.m. on Wednesday climbed to €263.65 a megawatt-hour, the highest for that time since mid-July, according to data from Epex Spot SE. French power prices also rose to levels last seen during that earlier period of extreme heat.The hot weather is also expected to lift electricity demand as homes and businesses rely more heavily on air conditioning. French grid operator RTE forecasts demand will reach about 55 gigawatts around noon on Friday, roughly 6 gigawatts higher than at the same time a week earlier.Nuclear plants aren’t the only ones affected. Earlier this summer, high temperatures also reduced output at some gas-fired power stations, helping push hourly electricity prices above €500 a megawatt-hour at times.The ongoing drought is adding to pressure on Europe’s power system. Water levels on the Swiss section of the Rhone are “severely low,” likely forcing the operator to reduce output at the Beznau nuclear plant soon, said Alessandro Armenia, an energy analyst at intelligence firm Kpler Ltd.Low water is also disrupting energy transportation on the Rhine, a key route for coal and fuel. The water level at Kaub has dropped to 28 centimeters, the lowest since 2018, and is forecast to potentially fall to 24 centimeters on Friday, which would be the lowest in data going back to 1990.While energy companies can switch to rail for their coal supplies, logistics company Contargo said those alternative transport routes are also facing capacity constraints.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.