Solar photovoltaic generation reached historic milestones across Europe during the week commencing 28 April. France set a new all-time high with 135 GWh of solar generation on 30 April, the same day that Italy reached its record of 150 GWh. This surge in production was mirrored in Germany, which also posted a new April record by generating 397 GWh of solar power in a single day.

Such exceptional levels of solar output had an immediate and profound impact on wholesale electricity prices. AleaSoft Energy Forecasting reported significant price declines in most major European markets, including Belgium, the Netherlands, the United Kingdom, the Nordic countries, Portugal, and Spain.

Electricity Prices Hit Record Lows Across the Continent

During that week, average wholesale electricity prices fell below 65 euros per megawatt-hour (MWh) in all analysed markets, with the exception of the UK and Italy, where prices remained at €76.88/MWh and €80.91/MWh, respectively. By contrast, Spain and Portugal emerged as the markets with the lowest electricity prices in Europe, registering weekly averages of just €15.36/MWh and €16.50/MWh.

This price collapse was further exacerbated by negative hourly prices across several markets. On 1 May, Spain recorded its lowest hourly electricity price in history at -€10.00/MWh, reflecting a situation of extreme oversupply. That same day, the French market reached a staggering €118.01/MWh, its lowest price since July 2023. Meanwhile, Italy recorded a price of €0.00/MWh, the minimum allowed in the Italian market, a level last observed in April 2020.

“The combination of exceptionally high solar output, lower electricity demand, and declining gas prices played a decisive role in driving these markets down,” states the AleaSoft report. These market dynamics highlight the growing influence of renewable energy sources on European electricity pricing.

The Iberian Blackout and its Market Implications

The week also coincided with a significant blackout on the Iberian Peninsula, further influencing market dynamics. According to AleaSoft, this event disrupted the normal synchronisation of prices between Spain and Portugal, with the price coupling between both markets falling to 54%, compared to 84% the previous week and 95% throughout 2025 until that point.

This reduced coupling led to greater price divergence and volatility, compounding the effects of abundant renewable generation. Such volatility underscores the importance of grid stability and the challenges associated with managing increasingly decentralised and variable energy supplies.

Despite these price declines, AleaSoft warns that this trend is likely to reverse. Rising electricity demand, coupled with a forecasted decrease in solar and wind generation, is expected to push prices higher in the coming weeks. Additionally, the end of the spring season typically brings lower renewable output and higher consumption due to cooling demands.

Europe Surpasses 597 GW of Installed Solar Capacity

This surge in solar production is part of a broader trend of rapid expansion in renewable energy capacity across the continent. According to Strategic Energy, Europe has now surpassed 597 gigawatts (GW) of installed solar photovoltaic capacity as of 2024. This milestone reflects the continent’s accelerated push towards clean energy sources and its commitment to achieving net-zero carbon emissions targets.

However, this rapid expansion presents new challenges for grid operators and energy policymakers. Without sufficient energy storage systems and modernised grid infrastructure, the risk of overproduction leading to negative prices and wasted energy will continue to grow.

“Efficient integration of solar generation is essential to prevent market distortions and ensure the long-term sustainability of the energy transition,” AleaSoft cautions. The development of large-scale battery storage systems, grid interconnections, and demand response mechanisms will be critical to addressing these challenges.

Moreover, the current situation raises important questions about market design. As renewable penetration increases, traditional price signals may no longer adequately reflect system needs, prompting calls for reforms to better incentivise flexibility, storage solutions, and investments in grid infrastructure.