Skip to content
Welcome, thoughtbot's Giant Robots listeners!Start here
Drones: Industry & Defence
26OCT

France holds cheaper leg, heat unwinds

2 min read
15:07UTC

The France-Germany day-ahead spread compressed about 70% from its 30 June heatwave peak of €71.50 to around €18-26 by 5 July, as German prices nearly halved and France held the cheaper leg.

TechnologyDeveloping
Key takeaway

France held the cheaper day-ahead leg as the heat premium unwound, with Flamanville-3's September overhaul the forward risk.

The France-Germany day-ahead power spread compressed roughly 70% from its 30 June heatwave peak of €71.50/MWh to around €18-26/MWh by 4-5 July, as the heat broke and both legs fell⁠1. German day-ahead means dropped to roughly €62-64/MWh from €195 on 30 June, nearly halving.

France held the cheaper leg throughout the window, consistent with the 22 June reset where EDF nuclear kept French clearing below Germany. France last traded as the dearer leg on 15 June, a brief inversion that has not returned.

Germany's thermal stack drove the premium: gas-and-carbon CCGT set a high day-ahead floor through peak cooling demand, and that floor unwound as temperatures fell, compressing the clean spark spread with it.

The forward risk sits in September, when Flamanville-3 enters a year-long overhaul and removes roughly 1.6 GW from EDF's fleet at the onset of the heating season. Whether France holds the cheaper leg through it, or German thermal reclaims the discount, is the trade this desk watches.

Deep Analysis

In plain English

Electricity got much cheaper in Germany over the past week, falling from €195 per megawatt-hour on 30 June to around €62-64 by early July, as a heatwave-driven price spike unwound. France's prices stayed lower than Germany's throughout, as they usually do, because France's large nuclear fleet keeps its electricity cheap. The gap between the two countries' prices, which had widened to €71.50 during the heatwave, shrank back to about €18-26. This is largely weather returning to normal: less need for gas-fired power plants in Germany once wind picked back up, and France's nuclear stations kept running through the heat despite some output cuts.

Deep Analysis
Root Causes

Germany's day-ahead price is set by its gas-and-carbon thermal stack whenever wind output is low, so the clean spark spread, the margin a CCGT operator earns after paying for gas and carbon, widened to roughly €74/MWh at the 30 June peak and has now compressed as wind returned and gas-fired units stopped setting the marginal price.

France's cheaper leg depends on nuclear baseload staying online regardless of river temperature. EDF's 12% output cut on 30 June removed volume from Bugey, Golfech and Nogent without touching the low-cost baseload that actually sets the French clearing price, which is why the curtailment dented supply but did not flip France to the dearer leg.

What could happen next?
  • Risk

    Flamanville-3's scheduled overhaul from September removes 1,650 MW of French nuclear baseload through most of the 2026-27 winter, narrowing France's margin if another heatwave-driven curtailment event coincides with low wind.

    Medium term · Assessed
  • Meaning

    The spread compression back to EUR 18-26 is a return to the pre-heatwave baseline rather than evidence of a new structural low, since it depends on EDF's nuclear fleet running without further curtailment.

    Immediate · Assessed
  • Precedent

    The 15 June polarity flip shows France's cheaper-leg status can reverse within days once French forward contracts reprice on curtailment risk, a pattern Flamanville-3's outage could make more likely to recur.

    Short term · Reported
First Reported In

Update #24 · Hormuz tanker rebound is no LNG relief

energy-charts.info· 6 Jul 2026
Read original →
Different Perspectives
Nigerian Air Force
Nigerian Air Force
The air force listed 12 Turkish Aksungur and two Chinese CH-4D armed drones on 25 October. No contract has been published, so these are plans.
Civilians in Western Sahara
Civilians in Western Sahara
A UN report of October 2023 records allegations of Moroccan drone strikes east of the berm. An aerial strike there in November 2022 reportedly killed six civilians, the UN said, citing Polisario and local media.
Thunder Tiger
Thunder Tiger
The Taichung company said on 16 October that all 1,520 of its Gauntlet I attack drones passed inspection. Its MoU with AeroVironment covers fitting Switchblade to its uncrewed boats and ground vehicles and exploring joint production in Taiwan.
EDGE Group
EDGE Group
The Emirati group said on 9 October it will supply glide bombs and guidance kits for the Royal Moroccan Air Force's armed drones. A separate memorandum explores making small arms and aero engines in Morocco.
Rajnath Singh
Rajnath Singh
India's Defence Acquisition Council, which he chairs, approved about Rs 2.12 lakh crore of proposals on 26 October, including kamikaze drones and tank-mounted counter-drone systems. About 82 per cent of the value is to go to Indian industry, by the ministry's account.
Kongsberg
Kongsberg
The Norwegian group said on 13 October it will invest more than 200m zlotys in a Pomeranian plant to build and maintain SAN counter-drone systems. It expects series output to begin in the first half of 2028.

Written with AI from Lowdown's published reporting. Not individually reviewed by an editor. Editorial standards.