Eylert Ellefsen

This blog post explores the current low hydrological balance across the Alp region this winter and what that could mean in the event of warmer weather this summer. Hydro reservoir levels this winter are even lower than last year, where we saw very low production levels and river flows during the heatwave which affected Europe. Through the study conducted by EQ we have concluded there is a probability of 20-25% of seeing a similar situation this year, given that the hydrological balance in the Alps for the end of February 2023 is lower than what we saw at the same period in 2022.

Towards the end of 2022, power prices across Europe were extremely high as cold weather, a lack of wind power, strong gas markets and low levels of electricity generation from French nuclear plants all combined to create the power market’s perfect storm. More specifically, French power prices skyrocketed in week 50 as the supply situation became scarce. In reality, power supplies were only secured thanks to reduced consumption and strong imports, supported by all available French power generators running at maximum capacity.

We’re taking a look at the energy crisis across Europe and Germany, in particular, this winter. Gas prices are soaring, the European gas supply is under pressure when Russia is more or less cutting the gas delivery to Europe. The government in Germany has opened up to bringing back 5.9 GW of mothballed coal units in order to save gas as the country is struggling with its gas supply this winter. In addition, the power balance is worsened by the nuclear closures (4.1 GW) and some coal-fired plants seem to close down according to the coal exit plans despite the initiative from the government to re-start mothballed capacity.

The reservoir levels in Southern Norway are very low as we know. Politicians in Norway meanwhile, against the backdrop of exceptionally high power prices, are discussing the possibility of cutting all foreign power interconnectors to secure the power supply and avoid rationing.