Renewables projects curb German energy prices for 2013

Rising investment in renewable energy in Germany is pushing power prices for 2013 below those for next year, according to Bloomberg Businessweek.

Electricity for 2013 was 45 euro cents (61 dollar cents)/MWh cheaper than next year’s contract on 22 September after the gap widened to as much as €1.25 at the start of last week, broker prices on Bloomberg show.

Germany is set to build 7 GW of solar and wind capacity in 2013, a rise of 32 per cent from additions planned for next year, according to Societe Generale SA. The country’s total generation is expected to increase by 9.6 GW in 2013 while 3.2 GW of thermal plants will be retired.

Germany is installing more wind turbines and solar plants to offset capacity lost in its nuclear phase-out while limiting emissions.

Industrial users in Europe’s biggest economy are buying supply for next year as Germany’s biggest utility EON AG has already sold almost all of its electricity for the period, helping keep 2012 prices at a premium.

“Much of this premium has to do with new power plant projects coming online, both traditional coal and gas plants and renewable energy,” Sigurd Lie, a senior analyst at Nena AS in Oslo told Bloomberg by email.

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