(Bloomberg) -- French power prices turn negative for several hours on Tuesday as low demand combines with an increase in wind generation and strong solar output.
French intraday prices are trading as low as -€20 a megawatt-hour on the Epex Spot exchange. Electricity demand is persistently undershooting the daily estimates made by grid operator RTE as European economies struggle with little or no growth.
France is awash with electricity with solar and wind each providing more than 15% of supply, RTE data show. Nuclear output is at the lowest since Sunday, typically the day when demand is lowest. Even with exports to other countries at 10.9 gigawatts, supply will exceed demand at times on Tuesday, sending prices below zero.
Across Europe, industrial energy demand is down despite an easing of prices since the energy crisis. Former European Central Bank President Mario Draghi last week published his report about how to fix Europe’s ailing economy. The region is facing “a slow agony,” the product of years of neglect.
Further sapping momentum is the unusual constellation of pervading political weakness in the two key countries.
French President Emmanuel Macron leads a nation in limbo after elections resulted in a legislative impasse, while German Chancellor Olaf Scholz is struggling with dwindling approval ratings for his coalition after two regional votes saw one in three people voting for far-right extremists.
Recent assessments by the France’s treasury indicate that the country’s economic situation worsened during the two months Macron hesitated over choosing a new prime minister.
The day-ahead auction for France cleared at €48.57 a megawatt-hour with prices in the afternoon falling to zero, according to Epex data.
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