Wholesale
Industry challenges
The global energy wholesale markets face multiple complex challenges:
- Increasing renewables create downward pressure on wholesale electricity prices due to non-existing marginal costs but also increase market volatility due to their intermittent nature
- Changing load curves, e.g. duck curves, resulting from increased share of renewable put premium on (flexible) capacity
- The stronger future dependency on weather increases the relevance of intra-day markets, balancing needs, and weather derivatives
- Apart from temporary fly-ups, commodity prices continue to stay low due to efficiency gains in shale production and significant drops in oil prices
- Globalizing natural gas markets with new investments into LNG import and export infrastructure lead to global long-term price harmonization
