19 December 2023

PPA and Green Gas Markets End 2023 Lower

Charles Ward Head of Renewables for NSR

Charles Ward
Head of Renewables

“Fears of a winter supply crunch have largely evaporated.”

Current Market Fundamentals

  • Upward revision in temperature forecasts for the week ahead.
  • Strong renewable performance.
  • Wind power generation was around 11.5 gigawatts (GW) on Tuesday (12th Dec).
  • Good supply on the gas side.
  • Norwegian gas exports and strong send-out from LNG terminals.
  • We expect a ramp-up in French nuclear generation in the next few days

Have Green Gas Prices Peaked?

  • Natural gas prices were 15% higher in October.
  • Geopolitical volatility spooked spot markets.
  • Escalating fears of supply shortages this winter.
  • At one point, gas prices rallied by 40% to an eight-month high.
  • Natural gas inventories are now about 93% full.
  • For context, that is almost double the historical average for the time of year.
  • European gas demand in the third quarter of 2023 was 20% below the 2019-2021 average.
  • Winter weather could alter gas price trajectory.

Fran Reay
Market Analyst at New Stream

“We would not be surprised if NBP and TTF gas prices declined further next year. Demand is still fragile, and we still have well-above-average inventories despite a cold start to the winter across some of Europe.  We have done well in pivoting away from Russian gas imports. LNG has been fundamental to this, with high imports and the infrastructure to support their quick growth.

The UK gas market impact from the Israeli-Hamas war remains immaterial, but the market was very headline-driven in early winter when upside price risk was higher.”

Francesca Reay

Energy Market Analyst at New Stream


Green Gas

NBP Jan 2024








Relative Value in 2025/2026 for PPA Generators and Green Gas Producers

  • Supply and demand fundamentals continue to depress short-term markets.
  • Forward markets still hold some risk premium above the spot.
  • Opportunities for PPA and Green Gas fixing further out along the price curve.
  • 2025 and 2026 are now well above spot markets.

Price Volatility to Remain in 2024?

PPA Manager

Jamie Banks
PPA Manager at New Stream

“We have seen huge price swings through 2023 with intra-day moves of more than 5% a frequent occurrence. The market was very headline-driven at the start of winter, even focusing on supply issues in far-off Australia.

The question is, will we continue to see more of this volatility through 2024, or will pricing revert to more normal conditions that we experienced for the best part of 10 years until relatively recently? In the short term, gas inventory refill for next year will come into focus.

The summer injection period will now be critical as there is a need to fill storage sites for the following winter with a backdrop of lingering geopolitical and LNG supply risks.”

Price Volatility NBP With Day

NBP Within Day










Asian LNG Prices Drop to Two-Month Low as Demand Evaporate

  • Robust inventories and relatively weak demand across North Asia.
  • Spot prices are at the lowest since late September.
  • Fears of a winter supply crunch have significantly reduced in Asia.
  • This could result in more LNG cargo hitting European markets at the start of 2024.
  • As a price reference, an Indian spot shipment for February delivery was made in the $10.50 to $11.50 range


  • Climate negotiators in Dubai secured a ‘Historic’ deal to ‘transition away’ from fossil fuels.
  • Governments have agreed for the first time to “transition away” from fossil fuels to avert the worst effects of climate change.
  • A compromise text was required around the term “phase out” fossil fuels that had drawn fire from Saudi Arabia and other oil-producing nations.
  • Instead of the phrase “phase out”, the text tells countries to “transition away” from fossil fuels, beginning this decade.

hot hot hot




National Grid Balancing Services Automation

National Grid’s control room will begin automating some processes to balance supply and demand from this week.

Charles Ward Head of Renewables for NSR

Charles Ward
Head of Renewables


“This will probably increase opportunities for batteries and the amount used. However, I still think that the duration of batteries probably needs to quadruple, and that still costs.”


  • The new platform will reduce the manual directions required from the control room.
  • It will enable smaller units to be called in bulk and dispatched simultaneously.



New 1.4 GW Power Interconnector

A new power interconnector was also commissioned in December. The 1.4 GW cable will link the UK power market to Denmark.

We already import electricity from Norway, and New Stream has seen data flows on imports surge to record levels because of high Norwegian reservoir levels.