Moody's Investors Service said today that European power prices are likely to remain high in the medium term, due to technical problems at French nuclear plants, low water levels after droughts and risks to gas supplies.
"We expect wholesale power prices to remain at historically high levels in the medium term, albeit with marked differences between countries," it said.
In France, average power prices have been at a 23% premium to the German benchmark since January 2022 due to the problems at operator EDF's nuclear plants, the report said. The report, which also looked at Italy, Spain, the Nordics and Britain, said a plunge in Russian gas supplies and lower French nuclear output were pressuring the entire region.
Given gas is also needed by many other industries, coal generation will enjoy a revival and decarbonisation will take a step back, Moody's analysts said.
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