HIGHLIGHTS OF THE REPORT
• The first quarter of 2025 was marked by higher gas prices, lower wind and hydro generation (despite a remarkable quarter for solar generation), and a moderate increase in demand, which contributed to a rise in electricity prices. However, prices started to decrease in the spring, thanks to higher renewables output and lower gas prices, indicating a positive trajectory for the upcoming months.
• The European Power Benchmark averaged 100 €/MWh in Q1 2025, 49% higher than in Q1 2024, but 38% lower than in Q1 2023. Prices ranged from a quarterly average of 49 €/MWh in Finland to 145 €/MWh in Ireland. The largest year-on-year price increases were recorded in Portugal (+93%) and Spain (+92%), where prices had been rather low in Q1 2024. Prices rose significantly also in Slovenia (+91%). In contrast, price drops were registered only in Finland (-32%) and Sweden (-9%).
• Electricity consumption in the EU rose only slightly (+1%) compared with Q1 2024. On the national level, eighteen Member States, saw an increase in electricity consumption, while the remaining countries were stagnant or experienced a decline. Despite this modest increase, demand levels for Q1 2025 were still below the pre-crisis average (-6%, compared to the 2015-2019 range).
• The share of renewables declined to 41% in Q1 2025 (from 46% in Q1 2024), while the share of fossil fuels rose to 33% (from 28% in Q1 2024).
• Solar generation rose to a new record high for a first quarter, reaching 45 TWh (+30%). However, other renewable generation technologies experienced significant declines. Wind onshore generation declined by 17% (-22 TWh) and wind offshore fell by 22% (-4 TWh). Hydropower output also decreased by 15% (-16 TWh), albeit from high levels in Q1 2024.
• Fossil fuel quarterly generation increased by 33 TWh (+17%) in Q1 2025, due to declining generation from renewables and a moderate increase in demand. In total, coal-fired generation rose by 15% (+11 TWh), whereas less CO2-intensive gas generation increased even stronger by 23% (+21 TWh). Nuclear output rose by 4% (+6 TWh) in Q1 2025.
• Carbon prices in Q1 2025 fluctuated between 65-80 €/tCO2, peaking above 80 €/tCO2 in February before declining to prices slightly above 65 €/tCO2. The quarterly average was 73 €/tCO2, 23% higher than in Q1 2024. Emission allowances prices trended upwards until February, then declined for the rest of Q1 2025, mirroring gas market developments. Higher gas prices led to gas-to-coal fuel switching in Q1 2025, making gas-fired generation less profitable than coal-fired generation in the reference quarter.
• Retail electricity prices for households in EU capital cities rose marginally by 3% in Q1 2025 (255 €/MWh). This increase is driven by a rise in energy taxes and network charges, which offset a slight decrease in the energy component. Additionally, there was significant variation between Member States with several seeing double-digit percentage increases (e.g. Austria, Luxembourg, Poland) and others seeing large decreases in retail prices due to lower energy costs (e.g. Slovenia, Ireland, Finland).
• A record high for the first quarter of over 620 thousand new electric vehicles (EVs) were sold in Q1 2025 in the passenger car segment in the EU, a yearly increase of 15% compared with Q1 2024. This translates into a 21% EV share in the EU passenger car market, which is lower than the EV market share in China (32%), but more than two times the market share registered in the United States (9%). The largest share of new EV sales was recorded in Denmark, where 60% of all cars sold in Q1 2025 were EVs. Moreover, in Sweden and Finland more than half of all passenger cars sold could be plugged (56% and 53%, respectively).
• The number of hours with negative wholesale prices in Q1 2025 (814) was 103% higher than in Q1 2024. This represented an increase of 0.6 pp in the share of trading hours with negative prices in the total number of trading hours (1.1%). March saw the occurrence of negative prices booming, registering a record number of 756 hours with negative prices, despite a slow start in January and February. Sweden led European countries with the highest occurrence of negative prices in Q1 2025. The increasing occurrence of negative prices signals the need for short term storage and flexibility, increased interconnectivity, and incentives for demand-side response