Montel

The European Commission said on Friday that the Market Stability Reserve (MSR) of the EU Emissions Trading System (EU ETS) will remove 190 million carbon allowances from scheduled auctions between 1 September 2026 and 31 August 2027.   According to the Commission, the reduction corresponds to 19% of its estimate of the total number of allowances in circulation (TNAC), which stood at 1.023 billion allowances last year.   The TNAC is used as an indicator of surplus allowances in the carbon market.   The Commission said the reduction will be reflected in auction calendars due to be adopted around July 2026.   The MSR, which has been in operation since 2019, held 400 million allowances at the start of this year.   The Commission also noted that, until proposed amendments enter into force, allowances placed into the reserve will continue to be calculated under the existing rules governing the mechanism.   The next TNAC indicator is scheduled to be published by 1 June 2027.   Link to the full reporting by Cem Bektas in the comments.

How are PICASSO and MARI changing French balancing markets in practice? The answer is already starting to appear in the data. Recent MARI activations have highlighted significant differences between cross-border mFRR pricing and France's domestic balancing mechanism, creating new signals, risks, and opportunities for market participants. On 4 June, join Clément Bouilloux for a free webinar exploring what these developments mean for balancing and intraday trading in France and across Europe. We'll cover: ⚡ The impact of PICASSO and MARI on French balancing prices ⚡ Early lessons from the first MARI activations ⚡ How imbalance price formation is evolving ⚡ Key indicators to watch through the rest of 2026 📅 English webinar: 4 June | 14:00 CET Prefer French? We are also hosting a dedicated French-language webinar on 3 June, where Clement will cover the same market developments for French-speaking participants. 🎟️ Register for the English webinar: https://lnkd.in/g8zGstM6 👇 The registration link for the French-language webinar will be available in the comments.

Russian LNG vessels have avoided the Mediterranean since early March, adding up to two weeks to some export journeys to Asia and potentially impacting earnings, according to analysts and Montel calculations. Following a reported attack on the Russia-linked Arctic Metagaz vessel on 3 March, ships departing western Russian LNG export hubs have increasingly travelled around the Cape of Good Hope. Kpler data shows Russia shipped around 0.6m tonnes (0.8 bcm) of LNG via the route over the past three months, roughly triple the volume exported that way in the previous three months. While the longer route has added only a small increase to shipping costs, analysts say extended voyage times could reduce fleet availability. "If costs are similar and the journey duration is longer, this would mean the available fleet might bottleneck," said Yuriy Onyshkiv 🇺🇦, gas analyst at LSEG Data & Analytics. Anne-Sophie Corbeau of Columbia University’s Center on Global Energy Policy said the longer-haul journeys were "very likely" impacting Russian earnings. Link to the full reporting by Laurence Walker in the comments.

Energy markets are becoming more interconnected, more complex, and more volatile. From managing risk and liquidity to adapting trading strategies in a rapidly changing market, energy professionals are facing new challenges every day. That's why we're pleased to support the Energy Trading Leaders Summit as a media partner. Taking place on 2–3 June in Amsterdam, the event brings together senior leaders from across the European energy trading community to share insights, discuss market developments, and explore the trends shaping the future of energy trading. If you're attending, we'd love to connect. There is still time to register: https://lnkd.in/eF_JcEb3 📍 Amsterdam 📅 2–3 June 2026

Italy's temporary export scheme to Switzerland is already drawing scepticism from some market participants. The mechanism, launched last month and running until the end of August, aims to boost power exports to Switzerland during periods of renewable oversupply. However, traders must commit export capacity through auctions held two days before delivery, limiting their ability to react to rapidly changing market conditions. Jean-Paul Harreman, Director at Montel, said the mechanism may work reasonably well in "normal" market conditions as a procurement tool for incremental capacity. But when markets become stressed or highly volatile, the lack of flexibility could become a challenge. Harreman noted that the scheme risks being outcompeted by market-based flows that respond to stronger price signals and allow participants to adjust positions closer to delivery. Simone Lerma, Wholesale Power Coordinator at AIGET - Associazione Italiana di Grossisti di Energia e Trader, also pointed to positive aspects of the mechanism, but said operators active between Italy and Switzerland remain sceptical. The real test may come during periods of market stress, when flexibility matters most. Link to the full reporting by Alfredo Spalla in the comments.

France’s nuclear watchdog ASNR has urged EDF to strengthen fire risk management across its nuclear fleet, while noting that four fires reported last year in non-nuclear parts of plants had no impact on safety.   In its annual report, ASNR described fire risk as “one of the main hazards in a nuclear plant” and called for improvements in the handling of combustible materials during maintenance and construction work, chemical-risk prevention, and the treatment of firefighting water.   The report comes as EDF’s 63 GW nuclear fleet produced 373 TWh last year, a six-year high driven by higher reactor availability.   ASNR also flagged below-average safety performance at the Gravelines and Dampierre plants. At Gravelines, outage extensions and overlapping reactor shutdowns complicated planning and resource allocation. At Dampierre, the watchdog called for better management of emergency diesel generators after a high number of safety incidents last year.   The report also noted improvements in fire detection, intervention capabilities and staff training.   Link to the full reporting by Sophie Tetrel in the comments.

For Europe's gas market, one question matters more than any other right now: When will the Strait of Hormuz reopen? ⛽ "The key thing to most people's forecasting is when will the Strait of Hormuz open? That's the big uncertainty." At our Swedish Energy Day yesterday, Wayne Bryan, Director, European Gas Research at LSEG, explored how uncertainty around the Strait of Hormuz continues to shape gas market expectations. While markets are focused on the timing of a reopening, there are still major unknowns. How will the route operate afterwards? Will there be restrictions, tolls, or new geopolitical controls? Wayne also highlighted the growing challenge facing Europe’s gas storage refill efforts, with competition from Asia for LNG supplies adding further pressure as the disruption continues. As winter preparation ramps up, how much longer can Europe afford uncertainty around one of the world's most important energy chokepoints? 🎥 Watch Wayne Bryan’s full session, "Gas market update", for free via the link in the comments.

Negative power prices have become increasingly common across European power markets as solar and wind generation continue to expand alongside limited system flexibility.   But Denmark has increasingly diverged from Germany since the 1.4 GW Viking Link to the UK was launched in December 2023.   According to Priyanka Shinde, Market Expert at Montel, Denmark had previously been closely correlated with Germany during deep negative pricing events. Since Viking Link came online, Danish prices have often stayed above zero even when German prices turned below -100 EUR/MWh.   Shinde said Denmark, which is interconnected to Germany, now acts more as a transit country, being able to fully import excess German solar power and exporting it onwards to the UK via Viking Link, effectively “breaking the price correlation”.   Energinet’s Morten Pindstrup said the additional outlet capacity was equivalent to just under 40% of Denmark’s interconnection capacity with Germany, helping separate prices between DK1 and Germany.   However, Shinde added that upcoming changes to Continental Europe’s flow-based market coupling method could strengthen price coupling again in the future.   Link to the full reporting by Mathias Falkengaard and Wilhelm Zakrisson in the comments.