18.05.2022

Purchase of energy from renewable sources. How to protect the company against increases?

Tagi

Autor

Adam Wlizło

Member of the Board

Stock exchange prices of energy in Poland for 2023 exceeded the level of PLN 1,150 / MWh. The price forecasts also leave no room for doubt - analysts agree that it will be even more expensive. How to protect our companies from increases? We look for answers in renewable energy sources.

The purchase of energy from renewable sources has gained in importance over the last year, because the so far leading ecological emphasis has been supported by a very strong partner - the financial aspect. Over the last year, the purchase of "green" energy (often based on long-term cPPA contracts) has become strongly competitive with the purchase of energy from the power exchange, the prices of which have experienced a threefold increase y / y (one of the main culprits of the current increases is the situation on the coal market). The energy prices offered to companies in the last days for 2023 exceeded the level of PLN 1,250-1400 / MWh (rates vary depending on the characteristics of the recipients; let us remind you that in 2021 entrepreneurs were buying energy on average at PLN 300-400 / MWh).

The market response to the energy price rally came quickly. Renewable energy producers have noticed that they can realize higher profits on the sale of energy to end customers, while meeting the expectations of customers looking for cheaper energy. Many known entities are currently updating their business models, changing the current order in the field of green energy trading. For example, owners of RES generation assets enrich their enterprises with trading companies operating on the market that will sell green energy directly to end users.

Solutions enabling companies to reduce the amount of energy purchased at high prices have also gained popularity. And again, companies providing renewable energy solutions, including those enabling entrepreneurs to invest in their own energy sources, come to the rescue. We wrote more about it in the article: In search of cheap electricity – green strategies of Polish entrepreneurs

The price situation on the energy market is extremely difficult for many entities. The only consolation may be the fact that the increase in the competitiveness of renewable energy prices has become a strong motivator of market changes, and by the way or above all - it is a financial stimulus to accelerate investments with a positive impact on the environment.

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Through the eye of an expert. About the purchase of electricity for 2024

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From mid-January 2023, the energy exchange prices for 2024 oscillate in the range of PLN 700-850/MWh. It can be said that this is quite a promotion, considering that in the previous six months these prices generally did not go below PLN 1000/MWh, and at the peak they even reached PLN 1800/MWh. Current prices for companies are approx. PLN 100-200/MWh higher than the exchange prices (this value includes the costs incurred by sellers related to profiling and balancing customers, the so-called "colors", excise duty, service costs, but also the accompanying risks of price changes and sellers margin of course).

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12.05.2023

Join Enfree. Your future in the energy market.

The energy market poses more and more challenges to Polish companies. At Enfree, we help to face them - we develop energy purchase strategies for the largest recipients in the country and carry out purchasing processes for them.

If you know energy and would like to work with us, write to us. We are looking for support for our team.

Call us: +48 695 000 950

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30.01.2023

Why is it not worth waiting with the purchase of energy for 2024?

Loudly in the network about "low", exchange prices of energy listed on the SPOT market in January 2023. (low from the perspective of the prices we faced in 2022). A relatively attractive price level favors entrepreneurs whose energy sales contracts enable the settlement of energy purchases taking into account the current exchange prices (the so-called Day-Ahead Market).

Settlement taking into account exchange prices, both futures market and DAM (SPOT) prices, is an increasingly popular form of settlement of energy sold to large electricity and gas consumers.

Why is it worth not delaying the signing of such an agreement for 2024? Because we gain more than we lose. The main advantage is the ability to react immediately to the market situation. When the time is right, the purchase can be made immediately. In order to take full advantage of this arrangement, it is important to have enough time to catch the price opportunities that occur throughout the year. Therefore, the beginning of the year is a good time to look around the market and choose electricity and gas suppliers for the next year.

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