2024, record year for EU power sector – wholesale electricity prices decreased by 16%

The European Union had the cleanest power generation mix ever last year. Emissions were 59% lower than in 1990, while negative prices occurred 1,480 times. The average day-ahead wholesale electricity price in the EU declined by 16% from 2023.

2024 was a year of records for the European power sector, according to Eurelectric’s data. The only not-so-bright side was demand. Power demand didn’t pick up since the crisis, primarily due to low industrial consumption, Eurelectric said.

The EU has closed the year with lower electricity prices on average. In 2024, wholesale day-ahead market prices came down to EUR 82 per MWh from EUR 97 per MWh in 2023.

Investments in renewable electricity generation must be complemented by flexible capacity to balance their variability

The average was even lower – EUR 76 per MWh – up until the last quarter of the year, when a surge in gas prices, high winter demand, scarcity of solar power, and windless days brought power prices up, causing several spikes in Germany, Hungary, Romania and Sweden, to name a few, the organization said.

In parallel, negative prices broke a new record this year as they were registered 17% of the time in at least one bidding zone.

“Eurelectric’s data proves once again that investing in higher renewable generation is the right path for a more competitive and decarbonized economy, but it must be complemented by more firm and flexible capacity to balance their variability, limit reliance on costly fossil fuels and contain price spikes,” Eurelectric’s Policy Director Cillian O’Donoghue said.

The lowest emissions from the EU power sector

2024 marked the lowest emissions from the EU power sector. The annual drop was 13%. Renewables contributed 48% of the EU power generation mix, followed by nuclear, at 24% and fossil fuels at 28% – the lowest share ever.

While nuclear remained the single leading technology in producing power, wind kept its lead over natural gas from the past year, the data showed.

According to O’Donoghue, electrification remains to be the low-hanging fruit to decarbonize the EU. “The more you electrify your energy applications the easier you decarbonize, but demand for electricity is not where it should be today,” he added.

Power demand grew by less than 2% and remains lower than pre-crisis levels

Power demand grew by less than 2% from 2023, but it remained lower than pre-crisis levels. Eurelectric attributes some of the reduction to higher energy efficiency and energy savings. However, it said more than 50% of the decline was caused by industrial slowdown.

In Germany, the industry’s power consumption decreased by 13% in 2023 compared to 2021 and is expected to have sunk further in 2024 since industrial production declined 4% year on year, the organization underlined.

It has praised the Clean Industrial Deal as the ideal opportunity to provide new incentives to electrify, such as creating an electrification bank, electrification accelerated areas and de-risking mechanisms for long-term power purchase agreements.