Uniper's hedging strategy includes selling hydropower through 2027.

The German utility Uniper said that it has sold large quantities of future hydropower production as part of an hedging strategy.

Uniper sold 30% of German hydropower for 2026, at an average of 86 euros per megawatt-hour (MWh) and 5% for 2027 at 80 euros/MWh. This was revealed in a presentation to analysts on the earnings for 2024.

LSEG data revealed that the wholesale benchmark price of German power round-the clock from all sources for 2026 was 87.95 euro on Monday and 77.75 euro for 2027.

These discrepancies are due to the different wholesale prices of fuel components.

These levels reflect the use of fossil-generated energy and renewable resources, which are affected by national support schemes as well as unpredictable weather patterns.

Hedging is used by producers to protect themselves from price fluctuations and to lock-in production prices at favourable times.

Wholesale traders track the price trends to assess the physical assets of utilities.

Uniper sold 80 percent of its German production for 2025 at 121 Euros, after selling its output in 2024 at an average of 58 Euros.

Other coal, gas and nuclear power plants are also operated by the company in Europe. It also has wind and solar energy generation units which were not included.

Uniper, in relation to Nordic region prices, said that it sold 40% of its nuclear and hydropower output for 2026, and 25% for 2027, at an average price of 38 euros, after having achieved the same 38 euros with 70% of production for 2025, and 43 euro for 2024.

Vattenfall, a sector rival, said that on February 6, it had sold 52% (of the Nordic power output for 2025) at 48 euros/MWh. 27% (2026) at 41 euros/MWh and 11% (2027) at 41 euro/MWh. $1 = 0.9547 Euros (Reporting and editing by Christopher Cushing; Vera Eckert)

(source: Reuters)