Power prices in the Netherlands turned negative on Wednesday with the market so overloaded with green electricity that consumers are getting paid to use the excess supply.
(Bloomberg) — Power prices in the Netherlands turned negative on Wednesday with the market so overloaded with green electricity that consumers are getting paid to use the excess supply.
Prices fell to as low as -€739.96 a megawatt-hour between 1 and 2 p.m. in Amsterdam’s Epex Spot SE exchange, with the weighted average staying negative for every hour from 10 a.m. to 5 p.m. The surge of clean electricity has outstripped demand, showcasing power grids’ struggle to accommodate large variations in renewables.
While strong availability is usually a good thing, the Netherlands had about 16 gigawatts of clean power flooding the grid at a time when consumption was low, according to consultant Enappsys. Power cables connected to neighboring markets weren’t exporting much either, reducing demand.
“This was unexpected and something we will see again,” said Jean-Paul Harreman, a director at Enappsys.
The situation is another example of how far Europe has come from the energy crisis that had driven prices to record highs last year and threatened shortages over the winter. The region’s gas market too has flipped from being being short of supply to a glut.
World Gas Supply Shifts From Shortage to Glut With Demand Muted
Negative prices are common in the summer and during public holidays if it’s particularly windy. Grid managers have the option to turn down supply or boost demand. The Dutch operator, Tennet BV, issued an alert on Wednesday asking for less flows into the market.
An initial day-ahead power auction was canceled on Tuesday as traders struggled to price contracts as more supply than was needed hitting the grid. A second auction cleared with a negative price for the peak-load contract.
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