What were the striking figures on the electricity markets this month?
July has once again shown how quickly market conditions can change, even when comparing the same month to the previous year. A notable indicator comes from the day-ahead market: In July 2026, electricity prices remained below €1/MWh for more than 368 hours. In July 2025, that figure was just 29 hours. This illustrates how significantly the expansion of renewable energy and the dynamics of the energy system are changing price formation in European electricity markets.
The gas market provided yet another striking example of diverging market mechanisms. On July 9, the PEGAS THE Day-Ahead gas closing price rose above 50 €/MWh again. Just a few days later, however, the balancing market painted a completely different picture: preliminary prices for positive balancing group deviations fell to around -1 €/MWh, while within-day prices remained above 50 €/MWh and day-ahead prices hovered just below that level.
What are the possible reasons for this market behavior?
July demonstrated just how differently the same calendar month can unfold from year to year. While July 2025 was marked by exceptionally wet weather conditions, July 2026 was dominated by heat. The extreme temperatures led to operational challenges across Europe, as several countries had to reduce the output of their nuclear power plants due to cooling water restrictions. This resulted in less generation capacity being available, while at the same time electricity demand rose due to increased cooling requirements.
At the same time, ongoing geopolitical conflicts and general uncertainty in the commodity markets continued to drive increased volatility in the energy markets. The natural gas market clearly demonstrated that both an oversupply of L-gas can lead to negative prices and that global tensions can trigger significant price fluctuations.
What do you expect for the next month?
August has already begun with significant price fluctuations. On August 2, prices on the continuous intraday market fluctuated within a single day between approximately -29 €/MWh (5th percentile) and 314 €/MWh (95th percentile).
Looking ahead, many market observers expect these trends to intensify further. Forecasts indicate a high probability of additional heat waves in Europe, combined with strong PV feed-in and weak wind power generation. This could further widen price spreads and lead to even lower prices at midday as well as sharper price spikes in the evening hours.
