This week witnessed a widespread downturn across all GOs vintages, with price reductions ranging from a moderate 0.29 EUR for Nordic Hydro 2023 to a more pronounced 0.70 EUR for the 2025 vintage.

The 2025 vintage encountered significant headwinds in Week 46, with average prices plunging by 0.65 EUR/MWh, pushing values perilously close to the 5 EUR threshold. The majority of transactions for 2025 GOs ended the week just above this level.

Meanwhile, the 2024 vintage experienced a less severe decline, with Nordic Hydro retreating by 0.56 EUR. This disparity in performance led to a shift in the price dynamics between the 2024 and 2025 vintages, with the former now marginally outperforming the latter. This is evident in the slight edge of the 2024 vintage's volume-weighted average price (VWAP) over that of 2025.

In the pricing arena between Nordic and EU contracts for the 2024 vintage, the differential narrowed significantly. The advantage shifted from a minimal 0.01 EUR in favour of Nordic GOs to a more substantial 0.11 EUR lead in this week's assessments.

This week, the trading landscape experienced a pronounced deceleration, with a significant 65% drop in the number of transactions and a sharp 43% reduction in traded volumes compared to last week's figures.

In the midst of this subdued activity, the 2023 vintage emerged as the market's focal point, capturing an overwhelming 78% of the total trade volume. Transactions and volumes for all other vintages recorded this week remained notably low, underscoring the 2023 vintage's dominant market position.

W46 2023: Hydro Reservoir Nordic

W46 2023: Hydro Reservoir Norway

W46 2023: Hydro Reservoir Central Western Europe

W46 2023: Hydro Reservoir Iberian Peninsula

As Week 46 concludes, a scrutinising look at the Nordic hydropower reservoirs reveals an unbroken downward trajectory, marking the fifth consecutive week of decline. Reservoirs are expected to reach 78.7% capacity, dipping slightly below the historical average by 0.4 percentage points—a level not seen since Week 37. In contrast, Central Western Europe presents a divergent scenario, with reservoirs projected to achieve 81.1% capacity, translating to a 6.5% excess over the seasonal average, despite a trend of decreasing levels. The Iberian Peninsula, meanwhile, continues its hydrological resurgence, with reservoir levels expected to swell to 54.2% capacity in Week 45, surpassing the typical benchmark by a substantial 8.9 points.

This downturn in Nordic regions aligns with recent scant precipitation, capturing merely half and a fifth of the average volumes in Weeks 42 and 43, and similarly low figures in Week 45. However, buoyed by earlier heavy rains, particularly in Norway, hydroelectric production remains above the average seasonal output. While further diminution in water levels aligns with the usual late-autumn-to-year-end decline, projections until Week 49 indicate a descent to 2022 levels, approximately 69%, significantly below the norm.

Central Western Europe’s hydro reserves, standing at 81.1% as of Week 45, maintain a 6.5 percentage point lead over the average. Upcoming rainfall could disrupt the usual downward trend, potentially leading to higher-than-usual inflow and reservoir levels for this season. Reservoirs are anticipated to reach their annual peak around Week 47, at about 88%.

The Iberian Peninsula, on an even more positive note, defies traditional expectations of gradual weekly increases in reservoir levels. The 2023 forecasts surpass these norms significantly, buoyed by heavy rains from Weeks 42 to 45. Reservoirs are set to peak at an extraordinary 54.4% by Week 46. Despite an expected retraction to 50.8% by Week 49, levels are predicted to remain comfortably above seasonal norms.

In the context of diminishing reservoir levels in the Nordic region, now trailing below the average, the market for the current vintage's GOs sustained its vigour, marked by robust trading activity. Prices saw a marginal decline, oscillating between 3.5 and 4.5 EUR, maintaining a relative stability in a fluctuating environment.

As the year draws to a close, projections for the 2024 and 2025 GOs remain steady. We anticipate these vintages to trade within a stable band of 5 to 6.5 EUR/MWh, reflecting a consistent market sentiment as we move towards year-end.

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GO Week 46 Update - 2023 GOs dictate this week's market dynamics

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