Hydro storage is on a 'roller coaster' ride: after climbing steeply through the second half of last year, it is now over the top and on the steep down-slope this year. At least so far. One thing we have learned over the last three decades is that storage can change very quickly.

So it is hardly a surprise that the contract indexes all went up this month as storage fell. Should we be alarmed? Well, a lot of observers will be bracing for another year like last year, in which an unexpected fall in gas supplies added to pressure from low lake levels. But it is likely this year will be managed better due to having a bit more gas available, more coal available for generation at Huntly, more renewable generation, and an overall heightened level of awareness and preparedness on the part of the industry.