In this explainer lecture, Lion Hirth from the Centre for Sustainability will talk you through the workings of European gas and power markets, point to challenges and suggests a few remedies.
European energy markets are in turmoil. Natural gas prices have increased 1000% within a year and prices for electricity trade four times higher than during the historical all-time high in the 2008 commodity craze. Industry and households don’t feel much of the heat yet, because they benefit from longer-term contracts, but this is about to change shortly. Expect huge energy bills, large bankruptcies and an intense debate around energy poverty.
At the same time, the very workings of energy markets come under pressure as companies need to respond to margin calls and liquidity gets squeezed, such that a financial-crisis-type of meltdown suddenly looks like a real possibility. While the immediate pressure has eased a bit since Christmas (mainly due to mild temperatures), commodity markets now suggest that prices remain high for at least three more years.
The lecture will take place on Wednesday, 2 March 2022, 12:00-13:00 CET.
