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European Utilities Face Gas, Power Price Risks as Winter Nears, RBC Says

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Europe's energy sector is bracing for a volatile winter as regulatory interventions, strategic asset sales, and surging infrastructure investments collide across the continent, RBC Capital Markets strategists said in a note on Wednesday.

Iberdrola is preparing to sell about a 49% stake in its East Anglia Two offshore wind project in the UK, seeking infrastructure, sovereign wealth, and pension fund partners for about 5 billion euros in development. Iberdrola expects to distribute marketing materials to potential investors in the coming weeks.

Spain is weighing measures to curb a potential surge in wholesale electricity prices this winter as higher natural-gas costs threaten to push power prices sharply higher. RBC analysts said Spain is considering reviving the so-called Iberian exception, which capped gas prices for power generation during the 2022 energy crisis, amid projections that gas could reach 105 euros a megawatt-hour and electricity 189 euros/MWh.

Meanwhile, Spain's data-center ambitions are adding pressure on the government to soften proposed regulations for the rapidly expanding industry. Major companies including ACS, Iberdrola, Naturgy, Solaria and Acciona have established subsidiaries or entered projects tied to data centers. SpainDC estimates that a continuity scenario could generate 66.9 billion euros in cumulative direct and indirect investment between 2026 and 2030, while a restrictive regulatory framework could cut that investment by about 36%.

Elsewhere, France is unlikely to fill its gas-storage facilities much beyond the legally required 85% level before winter, RBC said, citing the CEO of Terega. The company expects France could become more reliant on US liquefied natural gas and Norwegian gas during a cold winter but does not anticipate supply shortages.

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Commodities

SEBI Settles With Five Adani Group Firms Over Disclosure Violations

The Securities and Exchange Board of India (SEBI) has settled adjudication proceedings against five Adani Group companies, which paid a total of 15.1 million Indian rupees for alleged violations related to the disclosure of related-party transactions and audit and limited review reports.The settlement follows an examination by the Indian capital markets regulator into allegations and corporate governance issues highlighted in a January 2023 report of Hindenburg Research, including possible violations of listing regulations and the erstwhile listing agreement.Under the terms of the settlement, Adani Enterprises (NSE:ADANIENT, BOM:512599) paid 7.6 million rupees, while Adani Green Energy (NSE:ADANIGREEN, BOM:541450) paid 4.6 million rupees, and Adani Total Gas (NSE:ATGL, BOM:542066), AWL Agri Business (NSE:AWL, BOM:543458) and Adani Energy Solutions (NSE:ADANIENSOL, BOM:539254) paid 975,000 rupees each.The companies settled the cases without admitting or denying the findings of fact or conclusions of law.

BOM:512599BOM:539254BOM:541450BOM:542066BOM:543458NSE:ADANIENSOLNSE:ADANIENTNSE:ADANIGREENNSE:ATGLNSE:AWL
Commodities

US Power Update: Prices Swing as PJM Hits $85.08/MWh Intraday High

US electricity markets saw significant price swings, with locational marginal prices varying widely across regions as power demand shifted.ISO New England led the markets at 5 p.m. ET with a locational marginal price of $34.71 per megawatt-hour, compared with $22.39/MWh for Midcontinent Independent System Operator, which posted the lowest price at that hour.For intraday peaks, PJM Interconnection reached $85.08/MWh at 8:15 a.m. ET, while ISONE recorded the lowest LMP in the negative territory at -$0.45/MWh at 11 a.m. ET.The National Weather Service's Climate Prediction Center forecasts above-normal temperatures across most of the US from Sept. 30-Oct. 6, with near-normal readings in parts of the West.

Commodities

US Crude Oil Inventories Rise, API Says

Data from the American Petroleum Institute revealed Tuesday that US crude oil inventories increased by1.79 million barrels in the week ended Sept. 23, following a 7.14-mmbbl build the previous week, and compared with analysts' estimate of a 500,000-bbl decline, according to a Bloomberg-compiled survey.The oil market now awaits the US Energy Information Administration's petroleum inventory report, scheduled for release on Wednesday.