- Volumes : Volumes in the week ended August 12 were soft and a touch below last year, despite the ongoing 4% growth in QLD. The bigger picture here is that in the calendar year to date, NEM-wide volumes are essentially little changed on last year.
- Future prices: Futures prices increased to be at new highs in NSW and Vic for FY18. We were somewhat surprised to see so little reaction in the futures prices to the news that the owners of Portland Aluminium smelter are cancelling their contracts. This must increase the risk of the smelter closing over the next 1-3 years.
- Spot electricity prices:. Spot electricity prices were much weaker this week and were just 7% above last year’s level. Good levels of wind generation and lower demand helped.
- REC. REC prices in FY17 and FY18 nudged up, but theoretical prices in FY19 and FY20 were a touch softer.
- Gas prices : gas prices were lower, and although well up on last year are more in line with a steady rather than dramatic increase.
- Utility share prices: Utility share prices were relative soft, with the exception of minnow electricity broker EWC. AGL on the back of soft results and relatively soft indications on FY17 guidance was down 8% in the week but is still well up on last year.
Base Load Futures
David Leitch is principal of ITK. He was formerly a Utility Analyst for leading investment banks over the past 30 years. The views expressed are his own. Please note our new section, Energy Markets, which will include analysis from Leitch on the energy markets and broader energy issues. And also note our live generation widget, and the APVI solar contribution.
David Leitch is a regular contributor to Renew Economy. He is principal at ITK, specialising in analysis of electricity, gas and decarbonisation drawn from 33 years experience in stockbroking research & analysis for UBS, JPMorgan and predecessor firms.