European power prices dive into negative due to robust wind generation
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Robust wind generation and reduced demand during the holiday season caused electricity prices to drop below zero in Germany. Wholesale markets in France, Denmark, and Britain also experienced negative pricing during specific periods.
On December 24, the German day-ahead price plummeted to -€3.37 ($-3.72) per megawatt-hour, followed by €0.41 for December 25, as reported by Epex Spot SE, the Paris-based power exchange.
On the first working day after Christmas, the contract for Wednesday settled at €60.80.
The occurrence of negative prices is becoming more common as the continent integrates additional weather-dependent renewable power.
In Germany, wind power generation is anticipated to remain robust for the remainder of the week, reaching a peak above 50 gigawatts on Friday, according to Bloomberg’s wind model.
Output hit a record 53 gigawatts on December 21.
Negative prices offer a glimpse into the future of European markets, indicating a potential imbalance unless the planned surge in renewable production aligns with a corresponding shift in demand.
This disparity is likely to become more evident until there is a substantial growth in electric car fleets, the implementation of smarter grids, and advancements in battery technologies.
On December 24, hourly prices in the UK reached as low as -£9.31 ($-11.84) per megawatt-hour, while rates dipped to -€11.93 in France and -€8.54 in Denmark on December 25, according to exchange data.
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