After weeks of relatively low prices driven by mild weather and strong renewable generation, Europe’s power markets are showing a marked reversal. According to analysis from AleaSoft Energy Forecasting, average electricity prices rose in most of the continent’s key markets during the third week of June, with several crossing the €70/MWh threshold and some exceeding €100/MWh on peak days.
This upward trend was largely driven by a sharp increase in gas prices, with TTF futures reaching their highest closing price since early April. Rising electricity demand, caused by early summer heatwaves across the continent, also played a key role.
Solar Sets Records as Wind Slumps
Solar photovoltaic production increased significantly across most European markets during the week of June 16. France led with a 28% week-on-week increase, followed by Germany (+12%) and Spain (+11%). Portugal also reversed its prior decline, posting a 12% rise. Conversely, Italy saw a 6.5% drop in solar output.
Both France and Germany broke all-time records for solar production: France reached 170 GWh on 16 June, while Germany hit 469 GWh on 20 June. Spain recorded its second-highest output ever (221 GWh on 18 and 20 June), and Portugal set a new June record with 28 GWh on the 20th.
However, forecasts for the week of 23 June suggest solar production will decline in Germany and Italy, while remaining steady in Spain.
Wind power told a different story: output declined sharply, with Germany registering a 50% drop, followed by Spain (-23%) and Portugal (-27%). Only Italy (+17%) and France (+5.1%) recorded gains. Wind output is expected to rebound in the Iberian Peninsula, Germany, and France in the following week, while falling in Italy.
Demand Rises with the Heat
Electricity demand rose across nearly all major European markets as average temperatures climbed. Spain saw the largest increase (+7.8%), continuing a five-week streak. France (+5.2%), Belgium (+4.8%), Portugal (+3.1%), and Italy (+3.1%) also saw strong demand growth. The UK’s demand rose by 2.2%, while Germany remained stable.
Temperature increases ranged from 0.3°C in Italy to 3.0°C in Great Britain, with the Iberian Peninsula also experiencing notable warming.
Looking ahead, AleaSoft forecasts higher demand in France, Italy, and Germany, while Spain, Belgium, the UK, and Portugal are expected to see slight decreases.
Market Prices Surge in Most Regions
Power prices climbed across most European markets, except Nord Pool, which saw a 37% drop. France’s EPEX SPOT market experienced the steepest increase (+83%), followed by the MIBEL market in Spain (+40%). Weekly averages surpassed €70/MWh in most regions, with Italy leading at €118.86/MWh.
Daily peaks topped €100/MWh multiple times in the UK, Spain, Portugal, and Italy, with Italy reaching €136.57/MWh on 23 June, its highest price since February. Despite this, negative hourly prices were still recorded in most markets—except Italy—highlighting ongoing volatility.
Upcoming Market Outlook
Despite recent price increases, AleaSoft forecasts suggest that higher wind output will bring lower electricity prices in most markets during the final week of June. However, uncertainty in fuel markets and continued temperature rises may add complexity to short-term forecasts.
Industry Insights and Forward Look
AleaSoft will host its next monthly energy market webinar on 10 July, focusing on trends in PPA negotiations, the outlook for energy storage, and insights from major energy consumers and financiers. Featured speakers include Pedro González, Director-General of AEGE, and Roger Font, Managing Director of Energy Project Finance at Banco Sabadell.
