Lack of transparency dims Polish wholesale power market-traders

WARSAW/PRAGUE (Reuters) by Agnieszka Barteczko and Michael Kahn – An uncertain regulatory landscape is crimping development of the Polish wholesale power market, with participants complaining about unpredictable wholesale prices and lack of transparency. This is partly reflected in limited availability of cross-border trading capacity, which traders say keeps wholesale domestic power prices high and boosts local utilities. “The Polish market is strongly regulated,” said Steffen Herkner, head of continental power trading at Vattenfall . “We in trading are bothered by that.” “If, for example, we are in the process of fundamental analysis and then a political component is added that is hard to predict, it’s not so good for the market. High prices also appear to be a consequence of insufficient imports.” In 2014, the price of the front-year contract traded at an average of 169.25 zlotys ($46) per megawatt-hour — well above the benchmark German contract, which settled at an average 35.09 euros ($39) on Germany’s EEX exchange. The Polish front-year price was also higher than in neighbouring Czech Republic and Slovakia, which both typically traded below Germany. “The prices seemed to be artificially increased last year,” one trader on the Polish market said. As a reason for price … continue reading

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