BAKU, Azerbaijan, July 21. Electricity prices in Europe are expected to slightly decline over the summer, Trend reports via the latest publication from the International Energy Agency (IEA).
“In many European markets, wholesale power prices in the first half of 2022 were three to more than four times as high as the average in the first half of 2016 to 2021, primarily due to gas prices climbing to more than five times the value of the reference period,” the report said.
The IEA price index, representing the moving average of weighted prices in the main electricity markets for four quarters, reached almost 300 points in the second quarter of 2022, indicating three times higher average wholesale prices than in the reporting period of 2016, and 60 percent higher prices than over the same quarter of 2021.
According to the forecast, European electricity prices are expected to peak during the winter of 2022-2023.
For example, “In France, due to low expected nuclear availability, future prices as of early July 2022 show baseload prices exceeding 800 euros per MWh for the winter quarters of 2022/2023 – with peak load prices of more than EUR 1, 400 euros per MWh,” the report said.
“Soaring fossil fuel prices on global markets resulted in very high electricity prices. High costs for natural gas are the main driver, as gas-fired plants frequently set the wholesale electricity price in Europe. In addition, carbon prices in Europe have risen markedly since 2021, sparking discussions around their contribution to the electricity price increase,” the IEA noted.
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