What were the striking figures on the electricity markets this month?
February offered a fascinating contrast: periods of heavy snowfall and winter cold, coupled with unexpectedly mild, early spring-like days full of sunshine. This inconsistent weather left a clear mark on the electricity markets.
The price pressure caused by solar energy was particularly evident: around 140 quarter hours below €5/MWh were recorded in the day-ahead auction! A foretaste of the kind of record price dips we may see more frequently over the course of this year.
What are the possible reasons for this market behavior?
February’s power market dynamics were driven by a combination of extreme weather swings and intensifying geopolitical tensions. Cold spells tightened an already stressed gas system, with European storage levels trending well below recent years, increasing concerns around supply security.
Adding to this, the Middle East conflict escalated at the end of the month, pushing European gas benchmarks sharply higher as traders priced in risks to LNG shipments through the Strait of Hormuz.
In contrast, sudden bursts of mild, sunny weather temporarily reduced demand and boosted solar output, leading to several hours of subdued or negative power prices across Europe.
What do you expect for the next month?
With spring approaching, we expect PV generation to increase further, potentially adding more hours with very low or even negative prices. At the same time, geopolitical risks and lingering winter conditions remain key drivers of short‑term volatility. With gas storage levels still below typical seasonal norms, Europe remains highly sensitive to supply disruptions, meaning price spikes remain possible during colder periods or the ongoing geopolitical escalation.
