Europe power prices ease in early May as renewables output rises, but forecasts point to a rebound

Electricity prices eased across Europe in early May, underscoring how quickly supply conditions can shift market pricing. During the second week of May, daily prices in the main European electricity markets stayed below the levels seen in the previous week, pulling down weekly averages across all analyzed markets.

Weekly averages fall across most markets

Compared with the prior period, weekly average prices declined in every market covered. The British market recorded the smallest decrease at 0.1%, while France saw the sharpest fall of 40%. Elsewhere, reductions ranged from 7.5% in the Nordic market to 17% in Spain.

Most markets trade under €100/MWh, with Italy and Britain standing out

In the week of May 11, weekly average prices remained below €100/MWh across most European electricity markets. Italy and Britain were the main exceptions, posting averages of €116.22/MWh and €119.33/MWh, respectively.

At the low end of pricing, France, Spain and Portugal recorded some of the weakest weekly averages at €44.02/MWh, €49.83/MWh and €49.98/MWh. Prices were more tightly grouped in other markets, ranging from €90.29/MWh in Belgium to €98.87/MWh in Germany.

Iberia and France see frequent sub-€50/MWh days

Daily price patterns reinforced that divergence within Europe. Spain and Portugal—along with France—frequently recorded prices below €50/MWh throughout the second week of May. France also logged the lowest daily average of the week, dropping to just €24.36/MWh on May 14.

Italy and Britain face higher price pressure

By contrast, Italy and Britain experienced sustained upward pressure during the same period, with daily averages exceeding €100/MWh on multiple days. Several other markets—including Germany, Belgium, the Netherlands and parts of the Nordic region—also moved above €100/MWh during at least one trading session.

The highest daily price of the week was recorded by Italy at €136.36/MWh on May 15.

Renewables drive lower prices; wind decline could lift them next week

AleaSoft Energy Forecasting attributed the decline primarily to increased wind and solar generation across Europe during the second week of May. In some regions, lower electricity demand also helped weigh on prices.

Looking ahead to the third week of May, AleaSoft’s forward-looking forecasts suggest a potential reversal: wind energy production is expected to decline, which could push prices higher again. Demand is also projected to increase in certain markets, while gas prices are expected to remain an important factor shaping European electricity price dynamics.

For investors and market participants, the message from early May is clear: pricing has been highly responsive to renewable output and demand conditions—but near-term volatility may return as wind generation weakens and fuel costs continue to influence system marginal pricing.