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December 2023
Green Shift: Renergy in Africa
A surge in the generation of clean power has significantly contributed to the decline
in forward power prices across Europe, reaching their lowest levels since the prelude
to Russia's invasion of Ukraine in 2022. This invasion disrupted natural gas pipeline
flows, causing a spike in the region's power prices.
The base wholesale fair value power prices for the first quarter of 2024 in Germany
and France, the two largest economies in the region, presently average around 102 and
105 euros per megawatt-hour (MWh), respectively, as reported by LSEG.
These forward value estimates represent a notable reduction, standing at less than half the average wholesale power prices witnessed in both countries in 2022. Additionally, forward markets suggest that prices are poised to remain below 105 Euros/MWH in both countries through the conclusion of 2025.
While subject to alterations based on evolving market conditions, these comparatively low forward price curves are anticipated to provide relief to energy-intensive consumers who had been compelled to curtail power usage due to elevated prices in recent years.
These forward value estimates represent a notable reduction, standing at less than half the average wholesale power prices witnessed in both countries in 2022. Additionally, forward markets suggest that prices are poised to remain below 105 Euros/MWH in both countries through the conclusion of 2025.
While subject to alterations based on evolving market conditions, these comparatively low forward price curves are anticipated to provide relief to energy-intensive consumers who had been compelled to curtail power usage due to elevated prices in recent years.
COMMITMENT TO CLEAN POWER
A crucial factor influencing the subdued power price outlook is the substantial increase
in clean power capacity development throughout Europe in recent years. There is widespread
confidence that further advancements in clean power will continue to emerge in the years ahead.
As Renergy exclusively focuses on solar projects in Africa, our ongoing commitment to the green energy transition in Sub-Saharan Africa is poised to significantly contribute to lower energy prices across the continent.
As Renergy exclusively focuses on solar projects in Africa, our ongoing commitment to the green energy transition in Sub-Saharan Africa is poised to significantly contribute to lower energy prices across the continent.
