(Montel) A European Commission approval this week of US-based General Electric and Australian investment bank Macquarie’s acquisition of a planned 650 MW wind farm project in northern Sweden will further dampen Elcert prices, analysts told Montel on Thursday.
The clearing of the deal – with project completion due in 2019 – for the Markbygden 1 wind farm would fuel bearish price expectations for the 2020s, they added.
The benchmark 2018 contract in the Elcert market was last seen at SEK 61/MWh (EUR 6.40/MWh), well below the contract high of SEK 252/MWh from 2013.
Strong surplus
Prices have been subdued by a strong surplus of certificates in the Norwegian-Swedish market, currently estimated at around 10.5 TWh, according to consultancy Bodecker Partners.
The surplus could swell to 36-37 TWh by 2026 if GE and Macquarie proceed with the Markbygden project, said Joachim Jernæs, senior analyst at Nena.
However, MK Online analyst Odd Gunnar Jakobsen said while he expected the 650 MW wind farm to be built, he doubted it would happen by 2019.
Norway and Sweden have a joint target of subsidising renewables with an annual output of 28.4 TWh between 2012 and 2020 but this target has been lifted to 46.4 TWh to 2030 to meet Swedish climate goals.
(EUR 1 = SEK 9.48)
Reporting by:
Anton Tigerstedt
anton@montel.no
16:09, Thursday, 31 August 2017