Posted on 08/29/2023 2:22:29 AM PDT by Cronos
One year ago, European politicians were in a state of panic watching wholesale gas prices break all-time records.
The numbers seemed to be in the grip of an irrepressible force: August 2022 began with the Title Transfer Facility (TTF), Europe's leading hub, trading gas at €145 per megawatt-hour (MWh), an alarming level.
Two weeks later, the TTF broke through the €200 MWh barrier for the first time ever. By 26 August, the TTF did the unthinkable: it reached €300 MWh.
.... Last Friday, the TTF closed trading at almost €35 MWh – an 88% decrease compared to the all-time peak achieved in August 2022. This brings the continent closer to the traditional patterns seen before the pandemic when prices, sustained by Russia's abundant and cheap deliveries, used to reliably range between €15 and €25 MWh.
The drastic turnaround represents one of Europe's greatest feats since the Kremlin ordered its troops to cross into Ukrainian territory and irreversibly transformed the long-established structure of global energy markets.
the bloc's consumption of gas dropped by 19.3% between August and January, easily surpassing the 15% goal that member states had set last year – on a voluntary basis. The savings policy proved so effective that it was later extended until March 2024.
..."Some of these factors can be considered cyclical or temporary – such as price-sensitive fuel switching or weather effects," the agency said in a report published earlier this year. "Others, such as renewable capacity additions, efficiency improvements and sales of heat pumps, are structural – laying the foundation for lasting reductions in gas demand."
With this fresh understanding, the EU is no longer fearing the 2023-2024 winter.
(Excerpt) Read more at euronews.com ...
Source: https://www.euronews.com/2023/07/12/austria-imports-of-russian-gas-hit-pre-war-levels-exceeding-aid-to-ukraine
Thx.
European gas storage for the coming winter is already full past the minimum targets - way ahead of the normal schedule (over 90% full already, in aggregate).
More new LNG import capacity has already been activated in Europe, than the volume of pipeline gas that they imported from Russia in 2021. Landlocked Central European States are still building out infrastructure to transport those new supplies throughout their markets, but the big former customers of Russia (like Germany) are done.
Putin lost the energy war in dramatic fashion, which is a Strategic defeat for Russia.
“How is gas measured/priced “per megawatt-hour”?”
Those are the units that they use to price it for trade on European markets (Dutch TTF).
Typically, to make one megawatt of electricity....you need 7,600 cubic sq ft of natural gas.
I’ll just point out, prior to the war....a lot of the German back-up power units (getting out of nuke/coal energy) was natural gas (because of the cheap level that existed). That model was crapped-up badly as spring 2022 came up.
One way to compare the costs of different methods of electricity generation is to use a metric called the levelized cost of electricity (LCOE), which takes into account all costs over the lifetime of a power plant and divides them by the total electricity output from the plant over that period2. This provides a cost per MWh that can be used to compare different methods of electricity generation.It seemed a strange way to measure gas since production facilities are all different. But I guess one convention is as good as another.
Thx again.
Thx much.
“Austria imports of Russian gas hit pre-war levels”
…through pipelines that run through the Ukraine. Ukraine has announced its intention to not renew the Russian contract to transit that gas next year.
The Austrian company (OMV) currently importing Gazprom gas, has already committed billions of euros to developing Romanian fields, with the capacity to more than replace Russian gas imports to Austria.
Putin did that.
He is a Master Strategist.
Europe is in recession thanks to it’s slavish war policy promoted by it’s elitist political class. Hence, less energy is being used.
Didn’t the BRICS nations increase energy and other purchases to offset much of their EU loses???
There is no question that the worldwide changes are occurring rapidly. One finds:
"Before the summit the original BRICS members made up around 20% of global oil output, but the addition of KSA, the UAE and Iran means the share of the larger group has doubled to 42% of global crude oil output in 2022."
In "BRICS MATERIALS: the flourishing intra-BRICS oil trade: BNE Intellinews
Source: https://www.intellinews.com/brics-materials-the-flourishing-intra-brics-oil-trade-289879/?source=south-africa
In the long article: "The EU has banned the import of Russian oil and products, but the petrol in its cars and kerosine in its planes still the same Russian oil, except it has been forced to make a detour by ship halfway round the world. Aware of the problem, EU officials said in July the bloc needs to crack down on what is essentially the reprocessing and selling of sanctioned Russian crude oil by New Delhi. But as the supplies from Asia are impossible to replace, so far nothing has been done."
Putin and Biden and von der Leyen and more did that. Unintended consequences are making themselves seen.
One reads from the original article the following: "Last Friday, the TTF closed trading at almost €35 MWh..." which "...used to reliably range between €15 and €25 MWh."
In "The big turnaround: how Europe's gas prices fell from €300 to €35 MWh in the span of a year"
Source: https://www.euronews.com/my-europe/2023/08/28/the-big-turnaround-how-europes-gas-prices-fell-from-300-to-35-mwh-in-the-span-of-a-year
So after the effects of speculation have been addressed, "Europe's gas prices" which "fell" from one date, also rose compared to before the pandemic and war and sanctions. Rising "almost €35 MWh" from the previous "between €15 and €25 MWh." Taking the higher in the range, gas prices in Europe have risen long term circa €25 MWh to circa almost €35 MWh.
The headline did not reflect this, but our former neighbors in Germany report something like that as their reality.
From the specualtors' high of "€300 to €35 MWh" is great. Still, it's well above what it was. About 1.4 times higher, at the minimum.
Only in climate change bizarro world is a two year price increase from $15 to $35 not the headline making news.
bkmk
My understanding is that natural gas prices are still too high for german industry to be profitable.
Is this still true?
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